Hewlett-Packard CEO Meg Whitman is reportedly planning to combine the company's personal computer (PC) and printer divisions in a major restructuring maneuver to cut costs, streamline management and boost overall hardware sales.
Citing sources familiar with the matter, technology blog All Things Digital (AllThingsD) reported Tuesday that the combined unit will be run by Todd Bradley, who currently heads HP's personal systems group (PSG) which encompasses its PC business. Vyomesh Joshi, HP veteran and executive vice president of imaging and printing group (IPG), will retire after 31 years of service.
One source said the consolidation was part of cost-cutting and simplification measures hinted by Whitman during HP's last earnings conference call on Feb. 22, during which she discussed streamlining HP's internal operations and its interactions with customers. The move would also make it easier to approach customers with unified product offerings, the source added.
The New York Times, citing an unnamed source, reported that the announcement was expected to be made within a day or two. Layoffs were also likely. It also noted that the internal overhaul would be Whitman's first major strategic move for the PSG arm since she became CEO last September and a month later, decided to retain the PC unit. Former CEO Leo Apotheker had initially wanted to spin off this business.
Whitman's latest decision comes as HP's PC business continues to struggle with falling sales and profits.
AllThingsD reported that PSG and IPG accounted for US$65 billion in sales, or more than 51 percent of HP's overall sales last year. If combined, the new unit will be the company's largest group.
HP's printing arm, while a main contributor to revenue, earns more from ink cartridges and other supplies rather than printers themselves, and has seen declining business, the report added.