HP Vows to Keep Up Cuts in Cost Major Acquisitions Aren't Part of Plans
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By Damon Darlin  The Hewlett-Packard chairman and chief executive, Mark Hurd, has assured analysts and investors that he plans to continue cutting costs and said he does not foresee making major acquisitions to maintain growth.
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By Connie Guglielmo  Shares of Hewlett-Packard, the world's largest maker of personal computers, fell Wednesday after holiday price cuts on PCs weighed on profit margins and the company's growth forecast disappointed some investors.
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An executive said laptop sales are on track, despite a report that HP is reigning in PC orders.
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HP knows it can&#39;t depend on Microsoft for marketing. This has been particularly clear throughout its relationship with the company.
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In a security analysts' conference this morning, Hewlett-Packard CEO Mark Hurd's message did not exactly follow the holiday spirit. Another round of cost-cutting at what can now be called the world's #1 PC manufacturer will be under way. During the first stage, which began in July 2005, the company let go of 15,300 employees; thus far, layoffs have not been mentioned for the next round, though it's not unlikely.
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(InfoWorld) - It's been a busy Monday for Hewlett-Packard as the company announced not one, but two proposed purchases. Somewhat overshadowed by theÂ $1.6 billion HP is forking overÂ toÂ acquire datacenter automation specialist Opsware,Â is the $241 million the vendor is offering for Neoware. Publicly traded Neoware provides Linux- and Windows-based thin-client computing devices as well as thin-client and virtualization software. HP's keen to use Neoware to expand its existing thin-client business. "Our objective is to become the preferred brand of thin clients and software for virtualized client computing," said Kevin Frost, vice president of business desktops with HP's personal systems group, in a release. HP's offer values Neoware at $16.25 per share. Neoware's shares ended trading Friday at $15.24 and by midday Monday were trading up 3.7 percent at $15.81. Subject to shareholder approval, the acquisition is set to close in the fourth quarter of calendar 2007. On becoming part of HP, Neoware will be incorporated into the vendor's business desktop unit of its personal systems group. Neoware's partners include ClearCube Technology, IBM, Microsoft, and VMware. Publicly traded Neoware has its headquarters in King of Prussia, Pennsylvania as well as offices in Europe and Asia. Â
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For investors, Hewlett-PackardÂs leak investigation is a nonissue, analysts say, unless it affects chief executive Mark V. Hurd.
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(InfoWorld) - Despite aÂ boardroom scandalÂ that seems to deepen every day, Hewlett-Packard has won new contracts this week, including one that could be worth $5 billion over the next 10 years. The U.S. Army awarded HP a contract that allows several U.S. agencies to order products including desktop PCs, laptops, printers, scanners and displays from HP. The deal does not include specific volumes of products but HP estimates that it will be worth $5 billion. The contract could last as long as 10 years if the groups agree on optional extensions. HP expects to begin taking orders Oct. 1. HP has also signed a seven-year extension on an outsourcing deal with DirecTV. HP will continue providing IT operations and applications testing services that help DirecTV introduce new services, acquire customers and ensure bills are sent accurately and quickly. HP will also offer local area network management, data center operations, database support and disaster recovery for DirecTV. The contract extension is valued at about $500 million. The deals come at a troubled time for HP. The company's chairman said this month that she willÂ step downÂ for her part in an investigation of internal company leaks that involvedÂ obtaining private phone recordsÂ of HP employees and journalists. Details of the extent of the investigation, and the extent to which HP's top executives were involved in it,Â continue to surface. Â
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Despite the announcement that Gateway will acquire Packard Bell, Chinese computer manufacturer Lenovo said Tuesday that it will not completely give up on attempts to acquire the company itself.
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TAIPEI, TAIWAN -- More than two years after completing its buyout of rival Compaq Computer Inc., Hewlett-Packard Co. (HP) has not done enough to take full advantage of the acquisition, according to HP's chairman and chief executive officer (CEO).
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Hewlett-Packard Co.  will be under pressure to sell its personal computer business after IBM's decision to sell its PC operations to China's top PC manufacturer, but analysts said the No. 2 computer maker would hold on to its &#36;25 billion PC division for now.
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Hewlett-Packard Co. HPQ.N will be  under pressure to sell its personal computer business after  IBM's decision to sell its PC operations to China's top PC  manufacturer, but analysts said the No. 2 computer maker would  hold on to its $25 billion PC division for now.
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It's been a busy Monday for Hewlett-Packard as the company announced not one, but two proposed purchases. Somewhat overshadowed by theÂ $1.6 billion HP is forking overÂ toÂ acquire datacenter automation specialist Opsware,Â is the $241 million the vendor is offering for Neoware.
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Limited's cost-saving efforts don't mean it's bent on shrinking.
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Hewlett-Packard Co.   expects a strong back-to-school season for its notebook  computer business and sees no signs of the consumer laptop PC  market slowing, an HP executive said on Wednesday.
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(InfoWorld) - Hewlett-Packard Co. (HP) expects fiscal 2008 to be another solid financial year as the company continues to fine-tune its cost structure in an attempt to become more operationally efficient. HP Executive Vice President and Chief Financial Officer Bob Wayman, one day after announcing he will retire on Jan. 1, outlined the company's expectations for fiscal year 2008, projecting revenue between US$100.9 billion and $102.8 billion. The figures represent year-over-year growth of 4 percent to 6 percent and are in line with what analysts expected. The projections are also similar to the company's performance in fiscal 2006, when revenue of $91.7 billion represented 6 percent growth over previous-year revenue of $86.7 billion. HP already has set guidance for fiscal 2007, which began on Nov. 1, at $97 billion in revenue, or GAAP (generally accepted accounting principles) earnings per share of $2.28 to $2.33. Wayman set 2008 financial projections as part of a meeting with securities analysts in New York on Tuesday, where he and other HP executives laid out the company's goals for the next couple of years. Breaking it down by business segment, HP also expects growth in its Personal Systems Group, Imaging and Printing Group, Enterprise Storage and Servers and HP Services divisions to be between 4 percent to 6 percent in 2008. However, growth should be higher in both its Software and HP Financial Services segments, the company said. HP expects its software business, recently buoyed by its acquisition of Mercury Interactive Corp., to have 10 percent to 15 percent growth in fiscal 2007, while its financial services business will grow 6 percent to 8 percent. Speaking at Tuesday's event, HP Chief Executive Officer Mark Hurd said the company is a work in progress as it strives to achieve goals he laid out when he joined the company in late March 2005. To streamline the business, HP began a massive restructuring last year that resulted in 10 percent of its workforce being cut. Hurd implied Tuesday there would beÂ more slicing and dicing throughout HP to create a leaner business. As a result, operating margins should gradually improve over the next couple of years. In 2006 operating margins were 8 percent; in fiscal 2008 the company is projecting that will climb to between 9 percent to 9.5 percent, it said Tuesday. "We're committed to taking care of our business and our cost issues," Hurd told analysts. Â
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Hewlett-Packard next year will take a fresh approach to its utility computing initiative with a product designed to lower the cost of running corporate computing systems.