After recovering from near-fatal flirtations with bad management and unfocused strategies, Hewlett-Packard (HPQ) is once again perched atop the global personal computer marketplace.

As I'll soon explain, HP's healthy earnings results were driven by a marked increase in laptop sales and continued strength in its desktop printing business. The company easily beat analysts' expectations for the fourth quarter, with net income moving up 28%, to nearly $2.2 billion or 81 cents per share. Revenue was up 15% to more than $28 billion, beating estimates by $1 billion.

What an end to an impressive year for the Silicon Valley stalwart: Sales eclipsed $100 billion for the first time while net income came in at $7.3 billion, or $2.68 per share, up from $6.2 billion last year. A few months ago, HP unveiled a new ad campaign that focused on "making the computer personal again." Given the company's widening market share and financial performance, it sure looks like it struck a nerve with consumers.

Capitalizing on the ever-rising popularity of the portable computer, HP's laptop sales totaled more than $5 billion for the quarter, a 49% increase. Desktop sales moved up 15% to $4.2 billion. Combined, computer sales were responsible for approximately one-third of the quarter's overall sales. Operating margins increased too, by 1.5% to 5.8%, on lower component prices.

A much larger sales percentage was generated in the company's printing and imaging group, which includes its famous inkjet and laser printer lineups, digital cameras and, of course, replacement ink cartridges. These products are super profitable, and are fairly immune to the economic cycle since business and consumers don't want their expensive printers turning into paper weights over a $20 cartridge. This acts as a stabilizer on HP's earnings stream, which is especially important, given the ominous clouds hovering over discretionary consumer expenditures moving into 2008.

The continued unraveling of the mortgage debacle and the tightened availability of consumer credit will surely slow retail computer sales next year. Fortunately, the company is continuing to diversify its revenue base with sales increasingly sourced from emerging market nations in Asia, the Middle East and Africa. In China alone, which is now HP's third-largest PC market, revenue doubled over the past year as a newly minted middle-class discovered the joys of personal computer ownership. Look for this trend to continue, undeterred by the consumer-led slowdown that looks increasingly likely in the Unites States.

Finally, HP upped its financial forecasts for the current quarter. It is now looking for net income of 80 cents per share, which is three cents higher than the seers on Wall Street were expecting. It is also looking for sales near $27.5 billion, compared with the $27 billion consensus estimate. Locked in these estimates is a more conservative outlook for growth in the company's PC business. Nonetheless, the outlook was bright enough that the board authorized an $8 billion share repurchase allocation.