Linked by Howard Fosdick on Wed 29th Aug 2012 20:25 UTC
Hardware, Embedded Systems Can Hewlett-Packard bounce back? Third quarter results are in and they don't look good. Total revenue is down 5% year over year, and profits tanked on a $9.2 billion noncash write-down on the 2008 EDS acquisition. What's HP's strategy? Meg Whitman has now been CEO of the struggling giant for a year. She compares HP's turnaround to that of Starbucks, saying "Usually these kinds of turnarounds take anywhere between four or five years... There's nothing fancy about these turnarounds. This is not advanced business, this is 101." I question if refocusing on core competencies is enough. Maybe HP needs to get into the smartphone and tablet markets. Maybe it needs to expand its services business. Think I'm wrong? Then bet your money on HP stock and get rich. HPQ trades at its lowest point in a decade and sells for an rock bottom forward P/E of 4.2.
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Comment by kaiwai
by kaiwai on Thu 30th Aug 2012 14:25 UTC
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If it were me my focus would be on the enterprise first and foremost - being able to deliver and end to end solution, from the server to the workstation to the laptop and out to the tablet and smart phone. Become the one stop shop where the CIO can go to HP and say, "here is a shit tonne of money, give me something that works" and then HP weave their magic and voila a solution. The problem is that they've been unfocused, they've had their brands split, split and then split again, Compaq is something that made little sense from the beginning and should be just written off as a really bad experiment. The server side of the equation they should kill off Itanium - the volume isn't there, Intel really doesn't care and the cost really can't be justified in the long run. IMHO if they really do want to keep HP-UX and OpenVMS going along then maybe they need to look at x64 being a viable platform to standardise their server business on rather than the disjointed situation today.

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