Hewlett-Packard considers dumping units that miss targets

Hewlett-Packard considers dumping units that miss targets

Summary: HP is evaluating the performance of its business devisions and may remove any that do not meet the company's "objectives."

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Hewlett-Packard (HP) is evaluating the performance of its business devisions and assets, with the view to potentially remove any that do not meet the company's "objectives" or fail to achieve particular targets.

First reported by Bloomberg, the tech giant's CEO, Meg Whitman, said in a company Dec. 27 10-K filing with the U.S. Securities and Exchange Commission that the disposition of businesses is possible in order to shore up the firm and improve the balance sheet.

Within the filing, the firm said it planned to "continue to evaluate the potential disposition of assets and businesses that may no longer help us meet our objectives." In addition, Whitman has said that she doesn't plan to spin-off the tech giant's personal computer division.

The evaluation in the "Risk Factors" section of the filing documents how the company shake-up could have a number of consequences, including the possibility of "difficulties" in finding buyers or "alternative exit strategies on acceptable terms in a timely manner, which could delay the achievement of our strategic objectives."

The Palo Alto, California-based firm has been plagued with issues over the past year, including declining sales figures and management changes. After writing down $8.8 billion in November through the acquisition of software company Autonomy, the company was called upon to shed unprofitable divisions to try and get the balance sheet back in order, which include HP's printing and PC sectors.

HP has also confirmed that the U.S. Department of Justice (DOJ) had "opened an investigation relating to Autonomy" and said it would cooperate in the inquiry. However, the inquiry isn't the only problem HP faces -- as investors are reportedly taking the tech firm to court over "misleading: statements concerning the Autonomy acquisition which then in turn caused stock prices to slump.

Topics: Hewlett-Packard, Hardware, PCs

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4 comments
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  • Taking command

    Nice. Metrics is a good thing for a CEO to live by. She needs to metric the performance of HP's inept board of directors too
    flyguy29
  • Jettison The PC Business

    Windows is a dead-end. Mobile is the future, and the path to that future is Android.

    Or something else Linux-based.
    ldo17
    • That's your opinion

      You'll have to prove this is going to happen. Between iOS, Android with its potential lawsuits for breach of IP, and Windows 8/RT with its new concepts/features, a lot remains to be said. 2013 will be a real interesting year.
      christian.verstraete@...
  • Unprofitable

    "the company was called upon to shed unprofitable divisions to try and get the balance sheet back in order, which include HP's printing and PC sectors."

    Printing and PCs are still profitable for HP. Printing has about 14% net margins, PCs are 3-5%. Neither are unprofitable, but they are declining and will likely continue to decline in revenues. Unless they plan to spin-off both companies into a new company, which they might well be planning, I don't think they call sell them. I don't know who would want to buy either division unless HP just gave them away at a very low price.... The assets which are unprofitable are mostly likely certain services divisions from the former EDS.
    AdamS12