Hewlett Packard, the world’s largest IT company, suffered an 8% year-on-year decline in sales during the first quarter of the current financial year, the company announced yesterday.

Most of the company’s business units shrank year-on-year. "Frankly, it was a tough quarter, and every business had its challenges," CEO Meg Whitman told investment analyts.

The most calamitous decline came from its personal systems group (PSG), where sales fell 15% to $8.9 billion. In preceding quarters, the sharp decline in consumer PC sales had been offset by continued business investment, but in the latest quarter even business PC sales fell 7%.

"The fact is that for all that’s right with PSG, we underinvested in innovation for the last several years, and we’ve been late to market too often," Whitman remarked. "We have to lead again."

Imaging and Printing, which sells the company’s historically money-spinning printer cartridges, fell 7% to $6.3 billion while Enterprise Servers, Storage and Networking dropped 10% to $5.0 billion.

The only sizeable unit to grow was IT services, which nudged up 1% to $8.6 billion.  The company’s nascent software arm grew by 30% to $946 million, thanks mainly to the acquisition of Autonomy, while its finance arm grew 14% to $950 million.

Whitman said that the company’s problems fall into three categories: execution; ongoing issues with individual units, and industry shifts.

"We see a once-in-a-generation chance to define the future of technology and position HP as a leader for decades to come, But to seize this moment, we have to stabilise financial performance.

"And it’s clear, from both our revenue and margin profile, that our current cost base just isn’t affordable," she said. "On the current trajectory, we just won’t have the capacity that we need to invest."

Whitman’s forecast for the current quarter fell below analysts’ expectations, and the company’s share price fell 1.4% following the latest results.