Hewlett-Packard (HP) has reported a 29 per cent increase in third-quarter profits as a result of improved margins from cost cuts and falling component prices, surpassing Wall Street estimates and sending its shares up 1 per cent.

Net income in HP's fiscal third quarter rose to $1.78 billion (€1.32 billion) from $1.38 billion a year earlier. Revenue in the quarter rose to $25.4 billion from $21.9 billion a year earlier.

The world's largest maker of PCs and printers also forecast earnings and revenue for its current quarter that are ahead of analysts' expectations and fly in the face of growing economic concerns of consumers.

HP employs more than 4,000 people in Ireland primarily at facilities in Dublin, Leixlip, Co Kildare and Galway.

HP took the title of top PC maker from Dell last year and is benefiting while its rival attempts to revamp and cut costs.

HP's results came the same day that an internal investigation into accounting irregularities at its rival concluded. But HP executives played down expectations for its computer segment, saying that it is not realistic to think that its PC sales can keep growing at three times the pace of the overall computer market, which is currently increasing by about 10 per cent.

The company's chief executive Mark Hurd, who has led a turnaround at HP since his arrival in 2005, said the company also cashed in on growth in emerging markets during a quarter that is typically slow.

HP has benefited from sharp price declines for computer memory, disk drives and microprocessors this year amid a supply glut, analysts say.

The company has also cut 15,000 jobs in the past two years, and is consolidating data centres and selling properties to cut costs.

For its fourth quarter, the company forecast net income per share of 75 cents to 76 cents and revenue of $27 billion to $27.2 billion.