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HP May Sell Units Not Meeting Targets

Bloomberg has zeroed in on a comment made by Hewlett-Packard within its December 27 10-K filing with the U.S. Securities and Exchange Commission. According to the filing, the company plans to "evaluate the potential disposition of assets and businesses that may no longer help us meet our objectives." In other words, units of HP that aren't meeting targets could be dumped.

In the "Risk Factors" section of its regulatory filing, HP said that any disposal of an asset or business would have possible setbacks. "When we decide to sell, we may encounter difficulty in finding buyers or alternative exit strategies on acceptable terms in a timely manner, which could delay the achievement of our strategic objectives," the company said.

HP CEO Meg Whitman has been working to steer the company back in the right direction after five straight quarters of declining sales and "years of botched deals, management tumult and strategic missteps". The $8.8 billion writedown of Autonomy Corp. back in November also hasn't helped propel the company forward, pushing it into considering the sale of specific branches to bring value back to its stock.

"[The Company] may dispose of a business at a price or on terms that are less desirable than we had anticipated," HP said in the filing. "The impact of the divestiture on our revenue growth may be larger than projected."

The first arm supposedly on the chopping block is HP's Printing and Personal Systems Group. This was formed in March 2012 by combining the Imaging and Printing Group (IPG) and its Personal Systems Group (PSG). Headed by Todd Bradley, the executive vice president of PSG since 2005, this merging of two units was expected to drive profitable growth.

But according to Bloomberg, the company's PC business earned $35.7 billion in sales in fiscal 2012, or 29-percent of HP's overall sales. The printer business only earned $24.5 billion during fiscal 2012, or 20-percent of the company's total sales. Even more, HP shares declined a whopping 45-percent in 2012 although they gained 4.2-percent to $14.25 at yesterday’s close in New York.

Also in the December 27 filing, HP said that the U.S. Justice Department had opened an investigation into Autonomy. HP said that the software company misrepresented its overall performance before HP's acquisition in 2011.

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  • InvalidError
    People are losing interest in HP's overpriced and DRM-infested ink/toner cartridges?

    I'm just glad my LaserJet is from the pre-DRM era. Poke a hole in the cartridge side, fill with toner, good for another ~1500 pages, rinse and repeat until the drum wears out or the heating wire breaks.
    Reply
  • dgingeri
    I really, really, really, really, really, really, really, really, really, really, really, really, really, really hope they mean their HP-UX and Itanium units.
    Reply
  • socialfox
    InvalidErrorPeople are losing interest in HP's overpriced and DRM-infested ink/toner cartridges?I'm just glad my LaserJet is from the pre-DRM era. Poke a hole in the cartridge side, fill with toner, good for another ~1500 pages, rinse and repeat until the drum wears out or the heating wire breaks.
    Agreed, the ink cartridges for replacing all the colour and black in my HP B210 is more than what I bought the printer for, which came with the ink cartridges already included. Now a days, I just buy a new printer from HP rather than spending more money on the Ink Cartridges alone.
    Reply
  • booyaah
    I was at an IT convention recently and there was a contest with a small door prize for the winner.

    Q: How much would it cost to fill a car with an empty 20 gallon gas tank to full with HP color ink?

    A: ~$8,000,000

    No one even came close out of 50 ppl...I think someone did say a million though lol.
    Reply
  • Lets see PC's that come loaded with bloatware and printers with bad software and expensive cartridges. Who wouldn't want HP products
    Reply
  • ipwn3r456
    HP needs to join the mobile market already. Without that, they aren't going to survive with the PC market...
    Reply
  • AzureFlash
    HP, please collapse in a giant pile of awful fail already. I have been horrifically scarred for life whenever I've had to work with HP hardware. They are literally manufacturers of fecal matter.
    Reply
  • SirGCal
    socialfoxAgreed, the ink cartridges for replacing all the colour and black in my HP B210 is more than what I bought the printer for, which came with the ink cartridges already included. Now a days, I just buy a new printer from HP rather than spending more money on the Ink Cartridges alone.
    There's your problem... switch companies and stop buying from HP. As long as we keep supporting their 'disposable' printer system, they'll keep doing it. Problem is there aren't a whole lot 'better' out there... Canon, Epson, etc. perhaps...
    Reply
  • InvalidError
    SirGCalProblem is there aren't a whole lot 'better' out there... Canon, Epson, etc. perhaps...Most of the major brands are DRM-infested or at least were at some point. I know for sure Epson was among the first since my first (and only) color printer was a DRM-infested Epson over 10 years ago. Thankfully, there was a "jailbreak" for it that disabled counters checks on the printer and allowed resetting counters on cartridges. Unfortunately, due to using it somewhat sparingly, it didn't take very long for the head to clog and render the whole printer useless.
    Reply
  • SirGCal
    Ya, so far there's always been a resetting tool for the Epson, at least for photo printers. So they are good till the jet is junk. Why it's not a user-replacable part blows my @#$%ing mind... I actually just bought a new one looking for a very serviceable unit regardless of the price, and they were nowhere to be found, for any price.
    Reply