HP sells computer business

Conclusion which analysts drew after the statement of HP for leaving from the market of production sale of the PC: the head of HP Leo Apotheker stops throwing out money to burn (after purchase of Palm for $1 billion) and transfers attention there where sees a possibility of profit earning – corporate services.

As reported Wall Street Journal, Apoteker, speaking about consumer interest shift from the PC to tablets as about one of the main problems of division of personal computers of company (PSG), noted: "Influence of tablets - reality, and sales of TouchPad do not meet our expectations". Now HP considers the different possibilities of further existence of this business which "can include its department by means of creation of subsidiary company or other options".

Such precedent in the market already was: the declaration of IBM of the solution to sell the computer business to the Chinese company Lenovo at the end of 2004 was everyone's surprise. The transaction with Lenovo well affected work of IBM which fixed the positions, improved profitability from providing services to the enterprises. Lenovo grew meanwhile and became one of five largest PC makers: according to data of Gartner, Lenovo occupies 12.1% of a world share of sales of the PC in the second quarter (10.2 million units). Only Dell (10.6 million) and HP (14.8 million) are ahead of her.

Analysts see the reason of withdrawal of HP from business of production of the PC in the following: this market is not rather profitable for the company. The group of the personal systems (PSG) managed to generate $41 billion from sales about 48 million personal computers. Profit at the same time was $2 billion or about $40 for one computer.

At the same time deliveries of the PC to corporate clients create an excellent opportunity to zaarbotat on further service maintenance. Nevertheless, in the business model IBM in general appeared from sales of a computer hardware to the enterprises under own brand that does not prevent it to earn from services and installation of computers of other companies.

The editor-analyst of Guardian publishing house Charles Arthur considers that business of HP on production of the PC most likely will be sold to the Chinese company. He called two most probable candidates: Lenovo and Huawei. The possibility of the similar transaction – a big question as the PC market in the West is reduced could be an alternative Dell, but for Michael Dell. In the second quarter the American market dropped approximately by 5% (generally because of weakness of consumer demand), and last week Gartner reported that the European PC market dropped by 19%.

Dell strengthens the positions in the Pacific Rim as well as Lenovo. Asia and Latin America - the only regions where sales of the PC really grow, and a problem of Dell that sales to consumers in these regions will be tough and will difficult resist well financed (the supported Chinese capital) to the companies.

The last promulgated financial results of Dell show that the company has high income - $16.2 billion, at the same time net profit in a consumer sector of the market - $890 million. But whether it is enough at Dell of means for purchase of PSG? The standard price for such business is approximately 10-fold amount of profit. Thus the price of PSG can reach $20 billion. For Dell which is engaged in corporate restructuring while the prices of its actions fall such order of digits is too high.

As a result, in the PC market there are two American companies: Dell and Apple. Recently told Dell that it will be reorganized and transfers attention to the corporate sector. Apple feels most comfortably in business of production and sales of the PC: it does approximately sevenfold profit on each sold car in comparison with HP. (It is worth paying attention that Apple, according to Gartner - the only company which increased the European and American market share last quarter).

The fact that Apple the most expensive company in the world on market capitalization, can mean that the stock market expects from Apple of receiving the means which are available for consumers of three main markets: personal computers, smartphones and tablets. It is already known that it is the most profitable (and the biggest, on income) the producer of mobile phones, and it is fair for tablets. Business of the PC for Apple, maybe, not the most profitable, the analyst considers, but if to give the companies a little time, everything can change. Charles Arthur considers the events a turning point for the computer industry.