Last year's flat sales and precipitous falloff in profit for Silicon Valley's information technology sector could be mostly attributed to the disappointing performance of one company -- Hewlett-Packard (HPQ).
That was partly due to HP's humongous size. It accounted for nearly half of the annual revenue for the SV150 sector, which includes Oracle (ORCL), Cisco Systems (CSCO) and other companies that primarily sell tech products to other businesses.
More importantly, the Palo Alto giant's stunningly bad 2012 performance overshadowed the positive finances generally reported by its peers.
Besides seeing its sales drop 5 percent from the previous year to $119 billion, HP lost $12.7 billion. That was largely the reason the sector's overall revenue dipped slightly into the red and its collective profit plunged 62 percent.
Some of the corporation's troubles have been attributed to its heavy reliance on sales of its personal computers and printers, as mobile devices have become more popular and paper documents have lost favor.
"They are hurting in PCs, and they are really hurting in printing and imaging," said tech analyst Rob Enderle. "That business is kind of going away."
Another big problem has been HP's exorbitant overspending on other companies.
Last year it wrote off $18 billion for several questionable deals, including $8.8 billion for its much criticized $11 billion purchase of British software firm Autonomy.
On the positive side, HP has drawn cheers recently for cutting expenses, simplifying its operations and introducing a few new products, including a line of small, power-efficient computer servers. Plus, 2013 is looking more favorable for the entire sector, said tech analyst Roger Kay.
"The economy seems to be picking up," which generally spurs business-to-business sales, he said. "So all things being equal, it should improve a little bit."
Contact Steve Johnson at firstname.lastname@example.org or 408-920-5043. Follow him at Twitter.com/steveatmercnews