History of Hewlett-Packard (HP)

This article is devoted to the history of HP which in 2015 stopped the activity as a result of separation into two companies:

• HP Inc. (computers and printers) and
• Hewlett Packard Enterprise (HPE) (corporate solutions).

1939: Foundation of the company

HP was founded by graduates of the Stanford university William Hewlett and David Packard.

1966: Foundation of HP Laboratories

The company owned own research laboratory HP Laboratories founded in 1966.

2002: Consolidation with Compaq

In 2002 the company integrated with Compaq, having become the world leader in sale of personal computers.

And in particular divisions of Compaq were called a name of HP company 2 sports stadiums:

• Compaq of Center in Houston, earlier being called The Summit from which teams passed into Toyota Center and the building began to be used as the new house for Church of Lakewood (Lakewood Church), one of the biggest Protestant organizations of the USA.

• San Jose Compaq Center in San Jose (California) was renamed into HP Pavilion. This name to stadium was given by Carly Fiorina in huge degree bearing responsibility for a company merger, some jokers suggest to say as "HP of Fi-arena".

2006

Scandalous resignation of chairman of the board of directors Patricia Dunn

In 2006 the board of HP was affected by scandal which led to the chairman of the board of directors Patricia Patricia Dunn resignation. The organization by the top manager of illegal methods of fight against insiders became the reason. During the investigation investigators used false identity certificates for gaining access to a call recording. They addressed to the telephone companies, issuing themselves for reporters and directors of HP who were suspected of disclosure of information, and tried to obtain data on allegedly own talk thus.

Processing of 84 million kg of electronics

In 2006 processed HP 84 million kg of electronics around the world, it is 73% more than a similar indicator of IBM. The company is engaged in utilization of electronics more than 20 years, programs are implemented in more than 40 countries, regions and areas.

2008

Merger of EDS for $13.9 billion

In 2008 HP for $13.9 billion was purchased by EDS (Electronic Data Systems) – the American company specializing in storage systems, one of the largest American outsourcers of business processes and information technologies. Later it was renamed into HP Enterprise Services. It was expected that the transaction more than will double income of NR from providing services in the field of IT and will even more strengthen its positions as the world's largest technology company.

Turnover in 2008 to a fiscal year $118.4 billion

Turnover of the company in 2007-2008 financial year made $118.4 billion, the net profit of $8.3 billion.

Capitalization of Hewlett-Packard in 2008 was at a mark  of $97.13 billion.

The program of processing of cartridges in California

In April, 2008 HP company jointly with the State of California announced the beginning of joint programs of processing of cartridges and programs of eco-friendly printing which will allow to reduce emissions of greenhouse gases by 500 tons per year after complete implementation.

Declaration of plans of reduction of 24 thousand jobs

In September, 2008 NR announced intention to reduce about 24.6 thousand jobs within 3 years. New reductions will be executed in addition to these.

The staff of HP as of October, 2009 (taking into account reduction about 25 thousand jobs after acquisition of EDS that was already complete by that moment) made 304 thousand employees. Thus, within new reductions the state will be reduced still approximately by 3%. At the same time the vendor plans hiring of new employees – about 6 thousand people, generally in a segment of sales. The EDS company at the time of absorption in 2008 included 142 thousand employees.

2009

304 thousand employees

For September, 2009 in the company 304,000 employees work.

Revenues of HP Japan - 3.5% of sales of HP

Within financial year which came to the end in October, 2009 revenues of HP Japan were 363 billion yens ($4.26 billion) is about 3.5% of total sales of all group Hewlett-Packard.

2010

Acquisition of Palm for $1.4 billion

In April, 2010 it became known of acquisition of HP of Palm company for $1.4 billion. The most interesting asset in this transaction for NR is the WebOS platform on which the last Palm smartphones, since Palm Pre which left in sale in the summer of 2009 are based.

Growth of revenue in the 2nd quarter to $30.8 billion

In May, 2010 HP reported for the 2nd quarter 2009-2010 financial years which came to the end on April 30. Revenue of the company in comparison with the same period of last year grew by 13% to $30.8 billion. Profit increased by 28% and was $2.2 billion. Both indicators exceeded forecasts of independent analysts. Revenue of division of Enterprise Services taking into account rate fluctuations of currencies was reduced by 3% (without this parameter revenue grew by 2%). In general technology services create about a third of total revenue of the company.

Declaration of reduction of 9 thousand jobs

In June, 2010 announced HP intention within several next years to reduce about 9 thousand jobs. This measure, along with investments of $1 billion, will be undertaken for strengthening of business on release of corporate solutions, HP Enterprise Services.

Within restructuring of HP is going to integrate businesses on construction of data processing centers, development of platforms, network solutions, tools and applications. Restructuring is the next stage after integration into structure of HP of EDS company – she was engaged in this process about one and a half years, and now it is almost complete. However, in opinion, the managements, in a segment of corporate solutions of HP it is provided still not so fully as could and that there is a lot of space for further growth.

Will finance transformation of division of HP from own means that will be reflected in financial results on the commonly accepted accounting standards. It is expected that after completion of all structural changes annual gross savings of the company will make about $1 billion and net savings - $500-700 million.

Failure from release of smartphones on Windows Phone

In July, 2010 it became known that Hewlett-Packard will not release smartphones based on Microsoft Windows Phone 7. Instead the company is going to be focused on the WebOS platform which was purchased together with Palm. It the executive vice president of HP Todd Bradley said in an interview of CNBC.

Meanwhile, plans of HP concerning webOS remain so far are a little foggy. The company stated that it is going to release the most different devices on its basis - from mobile phones and tablets to Printers. Meanwhile the vendor does not refuse release of tablets and based on Windows 7, estimating perspectives of such devices so far. It is expected that until the end of 2010 webOS 2.0 will be announced. However in view of outflow of the talented personnel working on original webOS it will be not so simple to release the new version.

The head of HP Mark Hurd leaves the company

In August, 2010 the chief executive officer, the chairman of the board and the president of Hewlett-Packard 53-year-old Mark Hurd left all positions held in the company. Charges from the former employee of HP of sexual harassments became the reason of resignation of Hurd, as stated in the message of the company. Based on the made investigations, Hurd guilt was not proved. Nevertheless, he was found guilty of abuse of regulations of corporate ethics.

Charges of sexual harassments were brought by 50-year-old Jodie Fisher who worked in HP during the period from 2007 to 2009. She was engaged in the organization of the presentations and was the leader of these actions, for each of which received the royalties at the rate to $5 thousand. Commenting on Heard's resignation, she told that she "is surprised and disappointed" with such outcome. Fisher is the actress acting in thrillers, melodramas and a reality show. Its filmography includes scenes with erotic contents. Based on internal investigation it became clear that Heard spent for it money from the budget of the company, forging expense reports.

The anonymous source of Associated Press reports that all claims from Fischer to Heard were withdrawn after payment of monetary compensation which amount the source did not call. Heard will receive from HP as compensation $12.2 million in exchange for what he undertakes not to make claims to the employer in violation of the labor law. Heard's salary in 2009 made $1.2 million, and total earnings - more than $30 million. In addition to receiving immediate compensation, Heard continues to remain the shareholder of the company.

Commenting on this event, Heard recognizes errors in the behavior and says that leaving is the best option. "After five years of work in HP this hard solution. But I doubt that I after everything will be able to be the effective leader" the Acting as Heard on Friday, August 6, 51-year-old Cathie Lesjak who is the chief financial executive was appointed.

Penalty of $55 million in the USA for bribery of experts in deliveries of IT to a public sector

In August, 2010 it became known that Hewlett-Packard agreed to pay U.S. authorities $55 million in order that charges of fraud were dismissed from it, it is specified in the official statement of the U.S. Department of Justice.

HP is accused of bribery to system integrators which recommended Administrations of general services (General Services Administration - GSA) and to other American agencies to select products of HP among other suppliers. The GSA function consists in supply of government.

The claim with charges of fraud concerning at once several IT companies - HP, Accenture and Sun Microsystems - was submitted by Norman Rille, the former employee of Accenture, and Neal Roberts, the former employee of PricewaterhouseCoopers (PWC), in 2004 on a charge of violation of the law "About false right claims" (False Claims Act). It grants the right to any citizen of the state which does not have relation to the government to submit a claim if he will suspect someone of fraud to the detriment of the state. In 2007 the Ministry of Justice joined investigation.

The amount which HP agreed to pay for the purpose of peaceful settlement the second in value - in May of the same year in the amount of $87.5 million with U.S. authorities the supplier storage systems, the company EMC which became the person involved in similar investigation agreed about compensation. Besides, similar claims were also settled by the companies IBM, PWC and Computer Sciences. In HP though agreed to pay compensation, did not plead guilty. The company commented that such outcome is favorable for their shareholders.

Purchase of the supplier of DWH 3Par for $2.35 billion

In September, 2010 Hewlett-Packard announced signing of the final agreement about purchase of the Californian system provider of data storage, company 3Par, for $2.35 billion. The transaction got approval of Boards of Directors of both parties.

Acquisition 3Par will allow HP to strengthen a portfolio of DWH, Server and network solutions and to strengthen the strategy of Converged Infrastructure including active use of technologies of virtualization and cloud computing. Company 3Par cancelled earlier signed agreement with Dell which made the proposal on purchase of the first. According to one of clauses of the contract, 3Par paid Dell a penalty in the amount of $72 million for failure from the transaction.

The plan of purchase of ArcSight for $1.5 billion

In September, 2010 it became known that Hewlett-Packard is going to announce intention to purchase ArcSight company approximately for $1.5 billion or $43 for each ordinary share that is about 23% higher than their price of the moment of closing of biddings in September 10.

Leo Apotheker heads HP

On September 30, 2010 shareholders of Hewlett-Packard selected from quality of the new chief executive officer and president of the company 57-year-old Leo Apotheker. He will start execution of the duties on November 1, 2010 Besides, Apotheker will be a part of Board of Directors of HP.

The head's duties will pass to Apoteker from Cathie Lesjak who temporarily fulfilled duties of the former head of the company Mark Hurd after he left the company in August. Lesjak is also the chief financial executive of HP, she will continue to hold this position.

Revenue of HP according to the results of the 3 the quarter 2010-2011 financial years which came to the end on July 31, 2010 grew by 11.4% in comparison with the same period of last year to $30.7 billion, according to expectations of independent experts. The profit of the company was $1.77 billion against $1.67 billion the previous year. According to IDC, in the 2nd quarter 2010 of HP returned itself the first place on total revenue in the market of servers, having increased revenue in comparison year-on-year by 26%.

In the fourth quarter years revenue of the company was equal to $33.3 billion.

Revenue of the company for 2010 grew in comparison with 2009 by 10% and made $126 billion.

2011

Unsuccessful negotiations on Tibco Software purchase

In April, 2011 it became known that negotiations of HP on purchase of Tibco Software company were not crowned with success. Reports about it Reuters agency with reference to a source close to the course of events. Negotiators refuse comments to the press.

For HP it is big loss as in case of purchase of Tibco making a range of the corporate software, including a BI system, she would get access to perfectly mutually integrated business tools and very serious clients, such as Citibank Asia, airlines including Delta and Air France and power holdings led by ChevronTexaco.

Tibco was a partner of HP in the field of system integration and SOA for a decade. Tibco used platform means of HP, first of all on Unix, for deployments of the systems.

Such software products as the ActiveMatrix system, the system BPM iProcess Suite, Collaborative Information Manager and many others were involved in this process.

At the same time cooperation with Tibco allows HP to sustain the competition to IBM whom Tibco always called as well the largest rival. And despite small turnovers of Tibco (revenue about $754 million in 2010 in comparison with $100 billion IBM for the same period) – the company grows very in high gear.

Other competitor of Tibco is the Oracle corporation though their interests are not crossed as strictly, as with IBM.

Purchase of Tibco could allow HP to fight back IBM WebSphere and InfoSphere. Tibco has also widely used processing technology which well proved at trading firms. Perhaps, HP just has no alternative.

As analysts of Reuters assume if HP after all continues to select to itself the purpose in the market of system integration, then the companies can get to its focus Software AG and Progress Software: Their integration solutions, infrastructure of SOA and the BPM system are interesting to HP.

At this Software AG exceeds on the value Tibco with revenue $1.4 billion in 2010, and Progress has smaller turnover – only $156 million in 2010.

Also purchase of Tibco would escalate confrontation between HP and SAP as the first competes with the last on such positions as software of Sybase and SAP BusinessObjects (the last, as well as Tibco Spotfire, offers in-memory analytics and data visualization).

One of the most probable causes of failure of negotiations, certainly, lack of the arrangement on "the question price". The founder, the head, and the chairman of the board of directors of Tibco Vivek Ranadiv, certainly, not for this purpose developed it since 1997 to give at the reasonable price.

Failure from production of the PC

"Desire to find alternative ways of development of Personal Systems Group (PSG) shows our aspiration to meet expectations of shareholders, to be focused on implementation of our strategy and financial results", - the president and the chief executive of HP Leo Apotheker explained the heard statement of the company for an exit from computer business.

It is a little strange to hear similar words from the largest PC maker (17.6% of the market in the I quarter 2011, according to Gartner). However taking into account current trends and the previous steps of the company the solution looks quite natural.

Why did HP want to refuse the PC?

For last years follows from financial statements of HP that PSG is the second in value source of revenue after corporate business of HP. Nevertheless, this division creates rather small part of total profit which, besides, falls.

So, in 2007-2008 financial year the company earned $2.4 billion profit from sales of the PC that made 23% of the general indicator of profit. In 2009-2010 financial year this indicator was reduced to $2 billion (18%). Meanwhile for the last financial year the profit of corporate business of HP integrating servers, the storage system (SS), the software and services more than four times exceeded a similar indicator of PSG, having reached $8.8 billion.

Having tried to create the competitor of the operating room sistemeapple iOS by purchase of Palm with its WebOS for $1.4 billion in July, 2010 and then - iPad alternative on behalf of the TouchPad HP tablet computer, the company underwent full breakdown, TechCrunch writes.

"The world's largest producer of personal computers not only realized that there cannot be Apple, but also the fact that it cannot even compete with it", - writes a resource, noting that HP unsuccessfully tried to recreate a formula of Apple which essence consists in control over creation both program, and the hardware. Connect success of "apple" vendor with this formula of analytics.

"Now HP selects other model of revival - model of IBM", - TechCrunch summarizes.

"The company needs to get rid of the majority of assets of consumer business in the same way as made IBM this 6 years ago, - authors of article in Associated Press agree. - Instead of being a hostage of a situation and to try to try a key to hearts of consumers as it was made by Apple, HP decided to devote the forces to servers and other corporate products. Though these directions bring smaller income, profit in them higher".

"The management of HP is explicit with calculation selected the new head of Leo Apotheker", - Ars Technica consider. Let's remind, Apotheker, the former director of the German software provider SAP, came to the company in November, 2010, having replaced at this position of Mark Hurd.

"It is the person with work experience in area of software and services. If the management did not wish to replace focus, it would employ other manager".

In spite of the fact that the market rather nervously reacted to change of strategy of HP (on Friday, August 19, stocks of vendor dropped by 20%), the example of IBM can inspire shareholders, Forbes writes. From the moment of change of strategy and sale of computer business IBM rose in price more than twice, and in May, 2011 it for the first time in 15 years managed to overtake on market capitalization of Microsoft.

What could business of HP without PC represent?

The vendor will concentrate on production of servers, DWH, network equipment, development of the corporate software and providing cloud services, thus, having selected from quality of main competitors of IBM, Oracle, Cisco Systems and others. In recent years HP managed to save up quite good assets in these directions: since acquisition of EDS service provider in 2008 for $13.9 billion and finishing the producer of cloud DWH 3Par for $2.35 billion in 2010.

Together with the announcement of new strategy "without PC" the company announced and about one more important acquisition - within 18 months she intends to absorb Autonomy for $10 billion. It is the British company specializing in a broad spectrum of software solutions: from the systems of search, archiving and data management to solutions for customer interaction.

Who could purchase business of HP?

According to Guardian, the most probable buyers of PSG are Asian producers, including Lenovo, the fourth in value producer of personal computers in the world, and Huawei, first of all, known as developer and producer of mobile solutions and communication equipment.

Such companies as Dell and Apple, will be hardly interested in the transaction. Announced Dell recently itself desire to displace focus in a corporate segment whereas Apple more shows interest in architecture of ARM, than in the traditional systems.

Who would win and lost from the HP solution

Most of all Microsoft as it will force software corporation to review the strategy can suffer from the HP solution, analysts of Directions on Microsoft consider. However It should be noted that actually Microsoft of already secured - its future Windows 8 operating system will support mobile ARM processors and, as expected, equally well to be established on tablet devices.

The HP solution is a turning point in the history of the PC market, experts agree. And those who one of the first will manage to adapt under new realities will be winners here. At the same time any of analysts does not consider that in the short term PCs will stop the existence - they will be necessary just because there is no device capable to replace them yet.

• As a result of actions Apotekera the company received $3.3 billion damage.

Meg Whitman headed HP

In September, 2011 Meg Whitman started fulfillment of duties of the head of HP after leaving of her predecessor Leo Apotheker.

Apotheker was exposed to criticism and for plans of removal in separate business divisions of firm on production of the PC. Cancelled this solution Whitman after the taking office. Leo Apotheker offered also £7.8 billion for Autonomy software provider which, according to analysts, is overpriced on the whole £6 billion. Nevertheless, Whitman confirmed that the transaction can be continued.

Financial results of year: revenue of $127 billion

The HP company provided in December, 2011 results for 2011 financial year which ended on October 31, 2011. Revenue of HP made $127.4 billion worldwide that is 1% more, than a year ago. 36% of revenue are the share of EMEA region. HP did not call results on Russia, but, according to the estimates of analysts of IDC, in the Russian market of personal computers the company improved positions for 2.3%, the share in the market of desktops grew by 2.9%, notebooks - for 1.7%.

The company does not open financial results on certain regions. "This financial year, including the IV quarter of last year till III quarter present, in the Russian market of HP personal computers improved the positions for 2.3%, on desktops the share in the market grew by 2.9%, on notebooks - for 1.7%. The Segment of workstations of growth did not show, but HP already occupies more than 60% of this market", - the CEO of IDC company in Russia and the CIS Robert Farish explained to journalists.

• Hewlett-Packard announced decrease in profit in the fourth quarter 2011 for 91% after encumbrance in $3.3 billion for WebOS business stop. The profit of the company was $200 million at the total amount of revenue of $32.1 billion the last financial quarter 2011 which ended on October 31.

These digits can be compared to a profit of $2.5 billion at income of $33.3 billion in the same period of last year. Responsibility for such indicators for the first time undertook the CEO of HP Meg Whitman. Despite so sharp decrease in profit, income increased by 1% and reached $32.3 billion (analysts predicted income in the amount of $32.05 billion)

According to Michael Holt (Michael Holt), the analyst of Morningstar, results of the current quarter for HP look a little better, than it was expected. "It is important to estimate perspectives taking into account the new management. Let's look, than the next year will differ. The purposes and economic indicators delivered by the company are achievable, - he noted. - They are lower, than I expected, but, I believe that their plans are lower limit of what they want to reach. Meg Whitman transfers focus to operational business which was not enough".

2012

First quarter

In the first quarter 2012, terminated on January 31, growth of revenue of HP sharply slowed down. Total sales of HP for the first quarter 2012 were $30 billion that is 7% lower than the first quarter the previous year. The net profit of the company was $1.5 billion that is 44% lower than the same period of last year, or $0.73 for an action.

Revenues of division on production of the PC and workstations, Personal Systems Group, decreased by 15% in comparison with the same period of 2011 financial year and were $8.9 billion. Sales in a consumer sector at the same time decreased by 25% for the same period, and in the business sector – for 15%.

The division of Imaging and Printing Group which is responsible for release of printing devices also showed decline in income for 7% in the first quarter 2012 to $6.3 billion. Thus, after heavy 2011 during which HP nearly refused the business in a segment of the PC and changed the head the company did not manage to achieve stabilization of financial side yet.

Other significant division of the company which is engaged in rendering IT services could increase revenue by 1% in annual terms to $8.6 billion. Revenue from sales of the systems of industrial data storage and servers decreased by 10% whereas revenue from the software direction grew also by 10%.

On the second quarter 2012 of financial year of HP gives the forecast of profit at the level of $0.88-0.91 for an action. Nevertheless, for the whole year the company expects profit not less than $4 for an action.

Nevertheless, the CEO of HP Meg Whitman said that she of HP reached the profitability regulations planned to themselves in a quarter, "having taken necessary measures to its increase". Commenting on results of quarter before investors and industry analysts, Whitman also unveiled own plan of an output of the company from crisis consisting of three main units.

The first block – optimization of supply chains and failure from inefficient models which complicate development, sale and support of products. The second block – the solution of the current problems of each business division separately, including investments into new products and work on the existing products and services. At last, the third block of tasks is in earning from violently developing technologies, such as cloud computing, information management and security.

Declaration of reduction of 27 thousand (8%) employees

In May, 2012 Hewlett-Packard announced the future dismissal of 27 thousand employees within implementation of the long-term plan of restructuring of business of the company. Eventually this digit was increased up to 34 thousand human. Process started on October 31, 2011 and will be completely complete by the end of 2014 financial year. At the same time the plan of reduction of employees different depending on the region of presence.

HP hopes that the restructuring program will allow it to save $3-3.5 mlprd in 2014 financial year. The most part of this amount will be reinvested in the company. Reduction the state is a "difficult" step, but also and "a necessary measure for achievement of long-term health of the company", - the head of HP Meg Whitman said.

The second quarter

The profit of HP company in the second financial quarter which ended on April 30 was $1.6 billion that is 31% lower than similar quarter of previous year. Revenue for the specified period made $30.7 billion that is also 3% less in annual terms.

• Return to the PC

The new head of Hewlett-Packard Meg Whitman for the first time for the last year, very difficult for the company, made the statement which, at last, brought a pacification to partners of vendor. During the partner conference which took place in the middle of February, 2012 she said that HP remains first of all equipment manufacturer and that the main method of work in the market of HP is still work via the partner channel.

Let's remind that the previous CEO of the company, Leo Apotheker, was dismissed in September, 2011 just after unsuccessfully headed for the software market and purchases of Autonomy company for $10.3 billion Besides, Apotheker thought about sale of the division which is engaged in production of the PC.

For the first time after the appointment Whitman hurried to correct errors of the predecessor and publicly announced commitment of HP to the partner channel: "Last year our long-term relations, perhaps, began to develop not in the best way. Events around PSG, perhaps, created confusion of rather future plans and reduced authority of HP on your eyes", - she recognized.

By recognition Whitman, her ardent desire consists in putting an end to this drama and "appear in headings of news only concerning our products and customer relations and partners". "I would like to recover reputation of HP as reliable partner in building of your business", - Whitman concluded.

According to Whitman, she is going to put as soon as possible an end to uncertainty of rather future computer business of HP. She also completely refuses Apoteker's strategy and intends to return at the center hardware solutions. 70% of revenue of HP receive from sales of infrastructure solutions (servers, printers, storage systems, the PC and workstations). "This core of our business, and we should be proud of it", - the top manager told.

Strategy Whitman assumes positioning of HP as largest provider of IT infrastructure, software, services and solutions for different type of clients. "Our software should assist clients in the solution of difficult tasks, but it does not mean that HP should turn into the software company", - Meg Whitman noted.

However, according to her, hardware solutions and software will move ahead in a sheaf in such areas as management of large volumes of data and cloud computing. She also announced doubling of investments on R&D for all business divisions.

• Hewlett-Packard drew up the crisis plan which includes reduction for 25% of a line of computers which are made by the company, in the next two years.

At a meeting with financial analysts in San Francisco which took place on October 3, 2012 the company made rather weak forecast for the forthcoming financial year, assuming to receive $3.40-3.60 of earning per share. It is much lower than expectations of industry analysts: earlier they gave numbers in $4.18 of earning per share forthcoming financial year. Securities of the company reacted to the declaration of HP at once: during trading in the second half of day on October 3, 2012 they sank in the price for 11%.

Now HP actively reanimates business after a series of the mistakes made by former top managers including development of own line of smartphones and tablets, and then the followed failure from this idea. Besides, stated to HP intention about sale of the computer business, than caused a big stir in the market then having rejected also this plan.

The new head of the company Meg Whitman shortly after taking office in May, 2012 announced a course towards cost reduction which includes reduction of 27 thousand jobs and also new plans for development of all product lines.

Thus, reduction of a line of the made PCs will develop into reduction by a quarter of the range of models by 2014 and also the line of models of printers in similar terms will be reduced by 30%.

HP also, after Apple, decided to rely on more perfect design of the equipment. "We do not want to do ugly things", - Stacy Wolf, the vice president of corporation said. In particular, it gave the Spectre One all-in-one HP computer and the XT ultrabook as a successful example.

Besides, HP does not lose hope for success in the market of tablets, but only for corporate users. "We expect that this category will grow three times quicker than mass market of tablets", - Todd Bradley, the executive vice president of HP Printing and Personal Systems Group noted.

In more detail about a line of HP printers: HP printers

• Scandal with deliveries to Syria

At once several editions published explanations of HP on a request of the American department on securities and the exchanges concerning possible supplies of equipment to Syria that is forbidden by several regulatory legal acts of the USA. Reported about it on November 26, 2012 to Bloomberg and ComputerWorld.

SEC suspects that HP supplied the equipment for computer classes of Syria which formed the basis of a video surveillance system and tracking citizens, and also fixations of their electronic correspondence, for the amount more than 500 thousand dollars.

HP assures of the explanation that neither itself, nor any of his partners and distributors violated the law and did not supply the equipment to Syria. However, according to the company, it could occur via indirect sales channels and through not certified resellers, and gives an example of the Italian company which after official purchase of the equipment in an effect resold iron to Syria.

Also HP claims that it informed the partners on prohibition of export to some countries of the Middle East and Africa in connection with embargo and some regulatory legal acts of the USA. For example, export to Iran and Sudan is also prohibited.

Request from department on securities - the second blow to the company after submission of the class action of shareholders on HP after scandal with the emerged frauds in the reporting at merger of Autonomy.

Further steps of HP are not known yet.

Loss of $12.7 billion

In November, 2012 Hewlett-Packard reported financial results in 2011-2012 financial year which came to the end on October 31.

Revenue for all was reduced 2011-2012 financial year by 5% in comparison with previous year to $120.4 billion. The loss of the company made $12.7 billion against profit in the amount of $7.1 billion the previous year.

In 2012 financial year NR became the 10th largest company of the USA with an annual income to 120 billion dollars and a cash flow at the operational level in 10.6 billion dollars.

Revenue in the IV quarter 2011-2012 financial years made $30 billion that is 7% lower, than during the same period 2010-2011 financial years in comparison year-on-year.

The division of the personal systems making the PC in the IV quarter showed to 14% falling of revenue, division of printing devices - 5%, IT services - 6%, Enterprise Servers, Storage and Networking - decline by 9%. The division of Software showed growth of revenue by 14%. Revenue of HP of Financial Services changed slightly to the best (growth was 1%).

The quarter loss made $6.9 billion against profit in the amount of $239 million year before.

The world's largest producer of personal computers and servers announced severe loss the second quarter in a row: in the III quarter 2011-2012 financial years which came to the end on July 31 the loss made $8.9 billion.

In the III quarter as earlier reported in the press service of HP, severe loss was caused by write-off of intangible assets in the amount of $8 billion in division of Services.

This time, explained in the company, severe quarter loss is connected with depreciation of the assets connected with Autonomy company which was purchased by HP in October, 2011 for $12 billion Autonomy - the British software developer for work with data.

"The greatest part of a writeoff amount - $5 billion - is caused by gross accounting deviations, distortion and wrong representation of financial performance of Autonomy taking place before its acquisition by Hewlett-Packard company", - contains in the official statement.

The company said that errors were found during internal investigation and investigation which carried out the consulting agency PricewaterhouseCoopers. Based on checks it became clear that at the time of acquisition the market value of Autonomy was significantly overstated because of the wrong, overestimated data in financial statements.

HP addressed to the Commission of the USA on securities and the exchanges and also to Department of fight against large fraud in Great Britain for conducting criminal investigation. In the coming months of HP is going to find an indemnification method which its shareholders incurred^[1].

2013

Legend Microsoft joined HP the board

Ray Ozzie, the leading software architect who left Microsoft in 2011 together with a number of other key top managers in July, 2013 found a job in Board of Directors of HP as the last needs the guide to further market penetration of the corporate software and related services.

Ozzie one of three new board members of HP who filled up it in July, 2013. Along with it also James Skinner, the former head of McDonald company and the acting chairman of the board of directors of Walgreens and also the former head of Liberty Media Corporation company Robert Bennett entered there.

As a result the Board of Directors of HP grew from 9 to 12 persons, at the same time the company is going to continue search of world-class competent managers who could also enter it further.

Within council Ray Ozzie will head committee of technologies and finance that allows to assume that he will be responsible not only for technical issues, but also potential transactions M&A.

The head of Enterprise Group is discharged of work

In August, 2013 it was announced that Hewlett-Packard discharged the head of division of industrial solutions (Enterprise Group) Dave Donatelli of a position. Resignation happened against the background of the declaration of financial results of the third quarter of the next financial year during which revenue of corporation decreased by 8%.

Enterprise Group is responsible for production h86 and Itanium of servers and also products for corporate networks and storage systems. So far at the head of group there will be an operating officer of HP Bill Veghte. Donatelli, however, will not leave the company for ever: now he will be responsible for search of technology startups, potentially attractive to purchase.

Besides, HP will reassign the marketing director Marty Homlish and will integrate management of marketing and communications within a uniform division under control of Henry Gomez who was the director on communications. Now the last will become the marketing director of HP.

Financial results of HP were unsatisfactory, but even beyond all expectations corporations, the head of the company Meg Whitman recognized. She even recognized irrelevant the forecast made earlier according to which growth of revenue of the company had to begin in 2014 financial year. According to her, the hope for positive results remains only for some divisions now.

Let's remind that during the third quarter of the 2013 financial year which ended on July 31 the division of the PC showed decrease in revenue by 11%, notebooks – for 14% in piece expression, sales in mass market decreased by 22%, on commercial – for 3%. Enterprise Group revenue separately decreased by 9%, and sales of Business Critical Systems (BCS) which are based on Itanium family processors - for 26%.

2014

Bribe of $500 thousand for deliveries to head department of police of Poland

The Polish prosecutor's office established that the top manager of local office HP bribed in the amount of more than $500 thousand in exchange for the help in obtaining delivery contracts of the computer equipment in Head department of the Polish police. The Reuters agency in April, 2014 reported about it.

Authorities claim that about 70 different charges of the relation of 41 persons based on investigation of the corruption taking place in Poland 2007-2009 were brought. Among them – representatives of the large IT companies, officials and the former police officers, writes the agency.

It is reported during the investigation of this incident Poland cooperated with FBI and the U.S. Securities and Exchange Commission (Securities and Exchange Commission, SEC).

The law of the USA on counteraction to foreign corruption practice (U.S. Foreign Corrupt Practices Act, FCPA) prohibits the American companies to bribe foreign officials for business. Multimillion penalties are ordered to the firms convicted of violation of this law to payment.

The Polish prosecutors tell that in this case it is about the former official who was responsible for IT in Head department of police of Poland, and afterwards headed the Center of IT projects – the agency subordinated to the Ministry of Internal Affairs. According to the investigation, it provided preferences to a number of firms, including HP, on purchases for Head department of police for the total amount of $39.1 million.

The top manager of HP who does not work in the company any more paid for this help to the official $529 thousand and also presented an audio-, video and computer hardware for the total amount of $36.4 thousand. According to the Polish laws, the surnames accused of similar cases do not reveal in official statements therefore authorities mention the former corrupted official as Andrzej M., and the briber from HP - Tomasz Z.

According to prosecutors, the former top manager of HP also promised the Polish official "rollback" in the amount of $827.4 thousand for entering into the tender documentation of technical requirements to which there conformed only products offered them.

The charges prescribing imprisonment for a period of up to 12 years are brought to both the official, and the ex-top manager of HP of Poland, Reuters reports.

Declaration of reduction of 16 thousand employees

Hewlett-Packard announced in May, 2014 expansion of the program of staff reduction announced in May, 2012. The world's largest producer of servers is going to dismiss from 11 thousand to 16 thousand employees in addition to earlier planned reduction of 34 thousand jobs, says the company. During what period there will take place dismissals,^[2] is not specified^[3].

In May, 2012 the new chief executive of HP Meg Whitman began restructuring, having promised to dismiss about 25 thousand employees (8% of the general state).

At this time in the company about 250 thousand employees work. Taking into account today's announcement about 50 thousand jobs will be in total reduced, i.e. every fifth employee of HP will leave the company.

Commenting on changes, Whitman said that by this moment they could already reduce a part of costs of HP.

"I am glad to notify that restructuring bears fruits. Hewlett-Packard gradually becomes more harmonious, effective company with more accurate customer focus and partners" — she said.

The section of the company on Hewlett-Packard Enterprise and HP Inc.

On October 6, 2014 Hewlett-Packard confirmed officially plans of the section of for two public companies.

According to plans of company management, one of the newly created companies will begin to work in the field of infrastructure business, software development and provision of services. Its future name - Hewlett-Packard Enterprise.

Other enterprise - the successor of production business of the PC and printers, will be called HP Inc., she will reserve right to use of the operating logo of HP.

Separation of an asset will come to the end until the end of 2015 financial year - on October 31, 2015 at Hewlett-Packard. It is expected that after separation shareholders of Hewlett-Packard will receive shares both Hewlett-Packard Enterprise, and HP Inc.

In previous years HP faced a number of problems which negatively affected revenues of the company. Its revenue is reduced, the corporation is involved in series of scandals, in the market of IT it in a sense fades into the background: the companies like Amazon and Apple are ahead of her in creation of cloud computing, smartphones and tablets. Huge scales of HP as the head of the company Meg Whitman recognized, work against it.

For July 3, 2015 in the company about 300 thousand employees in 170 countries and 600 cities work. And despite the restructuring which is carried out Whitman, results were not rather good to save the company in its this type.

Meg Whitman, the president and the chief executive officer of HP, together with the chief financial officer of HP Cathie Lesjak, will pass to similar positions into Hewlett-Packard Enterprise.

The company on production of the PC and HP Inc printers. Dion Weisler, the executive vice president for printers and the personal systems in Hewlett-Packard will head. In HP Inc. it should hold positions of the president and chief executive officer. Meg Whitman will join HP Inc the board. as the non-executive chairman.

Separation into two companies happens on the fourth year of a five-year anti-crisis plan of the CEO of Hewlett-Packard Meg Whitman.

According to the management of HP, separation into two companies activates business as each of them will focus on accomplishment of own tasks. In the published statement Whitman announced the more, than ever convictions in success of separation and creation of two influential companies with chances of a victory in the market and opportunities of increase in value for shareholders.

But to do without heavy expenses it will not turn out. In February, 2015 the chief financial officer of HP Cathie Lesyak announced plans to spend in the next two years for separation of the company about $2 billion. For example, on costs, the work-related two headquarters and two chief financial officers, it is going to spend $400-450 million annually. This amount will be divided equally among themselves by HP Inc. and HPE.

Meg Whitman about the future greatness of HP

On October 15, 2014 Meg Whitman told about achievements of the company and its own from the moment of the introduction on a post of the general manager in September, 2011, and gave understanding of the vision of future greatness of HP. Fragments of a 30-minute discussion with the general manager of Entisys company Mike Strol are given.

Meg Whitman and Mike Strol discuss the IT new style

About importance of "IT new style"

In development of the application software everything changes, Whitman said. Instead of one release of times in nine months we have SaaS service, updated weekly, she told. Implementation process also changes. Once developers and operational personnel worked everyone in itself; now this close cooperation with everyday interaction — the trend which received the name DevOps.

She told: being the general manager of eBay, the company built the infrastructure under peak loads — she called it "build church on easter Sunday". Today eBay, as well as other large companies, can involve computing resources on demand according to a current demand.

About involvement of the young personnel

The companies will have to adapt to new technologies in terms of corporate culture to attract and employ so important young personnel, Whitman considers. It means adoption of the principles of DevOps and providing an opportunity to employees - to use IT as they consider it the most convenient that already occurs within a trend of BYOD.

"Those to whom for twenty, do not want anything with what we were reconciled in early days of our career — Whitman considers. — Our system administrators do not want a small cabin in NOC [control center]. They want mobility, means of "orchestration" of IT. They have absolutely other relations with technologies, unlike those that were at us".

About future plans of HP Enterprise

HP is divided into two parts: one for printers and the PC, another - for all corporate products and services which are sold by the company. Whitman which should head HP Enterprise, says that the new company starts with $10.5 billion which she intends to use that "to become even more aggressive" in purchases for strengthening of the business.

HP passed a way from $12 billion a debt to $5 billion a stock of cash in the operational part three years ago, emphasized with the CEO of the company.

"We now in much best financial position, than three years ago" — Whitman said.

About the OpenStack project

At the beginning of this year HP was announced the initiative by Helion on the OpenStack platform, designating official acceptance of this set of open-source technologies in administration of a cloud.

HP sees it as separation into the proprietary and open clouds constructed on OpenStack, Whitman noted.

"Like Linux, 30, 40 and even 50% of clouds will be constructed on OpenStack" — she believes. - HP will be the leading participant of community OpenStack as it already takes place in Linux. HP is with a force of No. 1 in development of the code in the OpenStack project today and we intend to build architecture around which everything will turn".

About transition to convergent infrastructure

"It is a trend, really gains strength in the industry — Whitman noted, meaning hyper-convergent infrastructure where the server, DWH and network technologies are offered in the form of closely integrated solution. — Instead of buying all this and to connect everything together, you buy integrated solution".

HP offers the convergent infrastructure constructed only on its products, but leaves an opportunity to include in it switches Cisco if that is wished by customers though, it did not fail to bite, there will hardly be persons interested to make it.

"From what suddenly to pay such price? It is not clear to me at all" — she told.

The trunk of network in is constructed by HP only on its own network equipment and DWH, and does not use products Cisco or EMC, emphasized Whitman.

About return to the channel

Having held a post of the general manager of HP, Whitman quickly realized need of improvement of partner relations for the channel.

"This company is built through network of our partners. We departed from it a little" — she noted former provision.

So, in addition to start of the fallen asleep mechanism of innovations in HP, Whitman gave a command - again to deliver partners in the center of sales strategy of the company. And it matched aspirations of her managers.

"When I announced everything that we turn facing the channel again, it was as if magic — Whitman told. — We should make still a lot of things, but we made big progress".

About technologies of high-performance computing

HP advances the concept of high-performance computing (HPC) as are incapable to do IBM or Lenovo, Whitman considers.

"We are the last who are still busy with high-performance computing" — she told.

HP develops the concept TsODa-na-chipe which received the name "The Machine" and it is capable "to change cardinally how processing is executed", Whitman told, having added - it is that innovation to which HP will devote even more attention in the future.

"This what should be engaged in HP — Whitman emphasized. — It is DNA of our founders".

HP sells a half of network business to Chinese

On October 27, 2014 it became known that Hewlett-Packard (HP) is going to sell a part of the business connected with release of network solutions. It is about the Chinese company H3C Technologies which is engaged in sale of network equipment and the software of a corporate class.

According to The Wall Street Journal and Bloomberg editions, the HP company intends to get rid of 51% of the stocks H3C, having sold their to one of private investment funds in China. The cost of all asset is estimated approximately at $5 billion^[4]

Implementation of network solutions is an insignificant part of business of HP. According to the results of the last financial year which came to the end on October 31, 2013 the company earned $2.53 billion from network equipment and the corresponding software that is 1.8% more, than the previous year. Total revenue of the producer made $112.3 billion where the Pacific Rim occupied a 19 percent share.

Created as Huawei Technologies joint venture and 3Com H3C company was a part of HP together with 3Com which was absorbed by the American corporation in 2010 for $2.7 billion. Now HP possesses 100% of the stocks H3C, the Huawei company sold the share in 2007.

HP is going to sell more than a half of the shares H3C

According to the analyst of Forrester Andre Kindness, in the conditions of big changes in the network industry and separations of business of HP H3C in China of the American company difficultly will manage. The expert considers that sale of a part of H3C to the Chinese investor will allow HP to put from itself executive responsibility, but to save at the same time profit on business.

Recession of revenue for 1%

According to the results of 2014 financial year which came to the end on October 31 the net profit of HP was slightly more than $5 billion, or $2.62 counting on one stock of the company that is 2% more in comparison with the same period of last year. The adjusted earnings grew up for 5% year on year, having reached $7.15 billion, or $3.74 counting on one security.^[5]

Annual sales dropped the third time in succession — by 0.8% to $111.45 billion. If not to consider rate fluctuation of currencies, then revenue of the company showed zero growth. About 44% of revenue were the share of North and South America. Shares of the countries of EMEA (Europe, the Middle East, Africa) and the Pacific Rim on total sales of vendor are estimated at 37% and 19% respectively.

The net profit of HP exceeded $5 billion, revenue of the company dropped almost by 1%

The division of HP of Personal Systems Group which is responsible for production and sale of personal computers showed growth of revenue from $32.18 billion in 2013 financial year to $34.3 billion a year later. Operating profit in this business was $1.3 billion. The company increased deliveries of notebooks to 10%, desktop PCs — by 2%.

In the market of list devices of sale of HP dropped by 4% to $22.98 billion in 2014 financial year, and operating profit reached $4.2 billion. The total release of the printing equipment was left without changes, but in a corporate segment there was a growth by 3%.

The division of HP of Enterprise Group (servers, disk storages and other corporate equipment) finished 12-month reporting period which end fell on October 31, 2014 with revenue in $27.81 billion that is 1% less, than the previous year and also operating profit at the level of $4 billion.

The producer increased sales of the server systems — by 3%, network equipment — for 4%. Income from storage systems dropped by 5%, from the business and critical systems (BCS) — for 22%. Earned $22.4 billion from the market of corporate services HP that is 7% less in comparison with 2013 financial year.

For 2% revenue of HP in software division — decreased to $3.93 billion. In the field of financial services the company gained income in the amount of $3.5 billion that is 4% less concerning an indicator of year prescription.

In the report it is also said that in 2014 financial year of HP paid dividends for the amount about $1.2 billion and redeemed about 86 million share on the total cost of $2.7 billion. The amount of the cash which accumulated on accounts of the company is measured by $5.9 billion — $1 billion more, than a year ago.

According to the results of the III quarter 2013-2014 financial years which came to the end on July 31, 2014 Hewlett-Packard announced growth of revenue in 1%, in comparison with the same period of 2013. Before it revenue of the company decreased within 11 quarters.

2015

HP begins to sell bezmarochny switches under the brand

On February 19, 2015 HP announced plans to sell the switching equipment made by Taiwanese company of Accton Technology and using the software of Cumulus Networks based on Linux. The American IT giant will apply corporate marking on these devices.^[6]

Thus, HP will operate as the reseller: the corporation will be engaged in order placement on delivery of new switches and will give the corresponding technical support.

HP begins to sell bezmarochny switches under the brand

HP says that the new equipment of a type Open Source first of all is intended for clients with big Internet business who want to get advantages of non-branded products and a full service support. Can annually earn $7-8 billion from such HP devices, the analyst of IDC Rohit Mehra is sure.

HP did not disclose the price of the new network equipment made by Accton, but specified approximate time frames of the beginning of its sales — the end of March, 2015. Representatives of telecommunication and financial sectors will be the first buyers.

At the time of the announcement of the transaction of HP and Accton cooperation of these companies continued about 20 years. As for Cumulus, this company will be not the only software developer with whom HP is going to work at the market of network equipment.

This business for HP is small, but growing. In 2014 financial year the American company earned $2.6 billion against $2.5 from sale of switches and other network equipment the previous year. The share of this direction in revenue of HP makes only 3%. For comparison, switches brought to Cisco Systems about 30% of total annual revenues in $47 billion.

The analyst of UBS Steve Milunovich said that he does not see for Cisco of serious threat in the bezmarochny equipment which buys HP for resale under the brand.

"There are more and more bases to believe about existence of a segment of the market of network equipment where large Internet players and corporate clients need open model. However we still doubt wide popularity of bezmarochny products among a large number of corporate clients" — Milunovich noted.

Purchase of Aruba Networks for $2.7 billion

On March 2, 2015 the Hewlett-Packard (HP) company announced Aruba Networks purchase. Due to this acquisition which cost was about $2.7 billion the American corporation will expand the opportunities in the market of mobile networks.

Shareholders of Aruba will receive from HP about $24.67 counting on each security belonging to them that is about 1% less in comparison with share value at the time of closing of biddings on February 27, 2015.

HP leaves the market of public clouds

On April 7, 2015 it became known of leaving of HP from the market of public cloud platforms. The company considered useless attempts to compete with Amazon, Google and Microsoft.

"We thought that people will rent or buy computing powers from us. But it turned out that it does not make sense to combat in this market" — the senior vice president of division of HP Cloud Bill Hilf said to the The New York Times edition.^[7]

At the same time the American company does not intend to leave cloud business completely. HP will save sale of hyper scalable servers Cloudline and Moonshot, a ready private cloud Helion Rack and also some other solutions for private and hybrid clouds.

The head of cloud business of HP Bill Hilf says that the company does not see sense to work at the market of public clouds

By November, 2015 HP will divide into two companies, one of which will be responsible for the PC and printers, and the second — for corporate business, including for a cloud platform of Helion OpenStack.

HP is not going to compete with such products as Amazon Web Services and Microsoft Azure, despite rapid development of the market of cloud computing. According to forecasts of analysts of IDC, during the period from 2015 to 2018 expenses on public services will grow in the world on average for 23% year.

HP could strengthen the cloud business due to absorption of the large player of this market as it was made by IBM in 2013 when purchased the developer of the cloud infrastructure solutions SoftLayer Technologies. However, most likely, HP decided to focus on those directions which make for it for more profit — for example, on private clouds.

Took a step to this party of HP in 2014, having purchased Eucalyptus company which allows customers to connect the private clouds to  a public cloud of Amazon EC2 for $100 million. The solutions Eucalyptus provide interaction with users of public clouds, however decided to work as HP with them in other format.

HP brought the business connected with public clouds to outsourcing, the analyst of Forrester Research Lauren Nelson specifies, having added that by Dell made the same in 2013, thereby having impaired a little itself reputation in the market.

Reduction of 11 thousand jobs. IT services are open to attack

On May 12, 2015 it became known of a new wave of reductions in HP. It concerned division of corporate IT services, The Register writes.

According to its sources close to HP, the company asked to write resignation letters at own will of the staff of department of assistance of sales (Sales Support) in the division of HP of Enterprise Services specializing in services of consulting, outsourcing and system integration. The size of the reduced staff is not called.

"These changes are a part of the strategy announced in 2012 directed to formation of working structure of HP necessary in order that the company became more flexible company focused on clients and partners" — reported in the press service of HP in response to a request of observers of The Register to comment on a situation with dismissals.^[8]

As notes the edition, business of HP of Enterprise Services is in decline because of decrease in number of big outsourcing projects though at the time of the publication of data on dismissals the company signed several important contracts with such clients as Deutsche Bank and TNT.

It became known of dismissals in division of corporate IT services of HP

The personnel decrease in HP Enterprise Services became a part of the large-scale personnel reorganization started in 2012. It was initially going to reduce 27 thousand jobs, but then this quantity grew to 55 thousand.

It is going to complete the large program of dismissals by October, 2015 when at HP financial year ends. By the end of February, 2015 44 thousand employees of the company within the carried-out restructuring were dismissed. Thus, till October 11 thousand more working positions will be liquidated.

As the chief financial officer of HP Cathie Lesjak explained, among the left employees with a long standing there are those who agreed to the offer on early retirement or got new job. At the same time Lesjak let know that the exact number of employees of HP who will leave the company by October, 2015 is unknown, and it can be more planned.

Staff reduction happens in the course of separation of HP into two companies: one by November 1, 2015 will be engaged in the activity connected with release of computers and printers, the second will supervise business in the field of the corporate equipment, software and services. Costs for this transformation of business in 2015-2016 will make about $2 billion, Cathie Lesyak reported.

Sale of a half of corporate business in China for $2.3 billion

On May 21, 2015 announced HP sale of the most part of corporate business in China. At the expense of the transaction the producer of the computer equipment hopes to strengthen the positions in the country, where to the American companies to work not easy.

According to the official statement, HP sells a 51 percent share in the new company H3C created based on H3C Technologies company and divisions of HP which are responsible for sales of servers, a storage system and IT services in the People's Republic of China. As the buyer in this transaction the Tsinghua Holdings state company which is financed by National Tsing Hua University — one of the technical educational institutions conducting in Celestial Empire acted.

HP learned to sell cheap servers of Google and Microsoft

On June 4, 2015 it became known of results of joint work of Hewlett-Packard (HP) and Taiwan contract producer of Foxconn Technology Group electronics in the market of servers. More than a year of the company is developed and advance a new class of the budget hardware solutions optimized under cloud computing.

In an interview of Bloomberg News of Antonio Neri, the head of division of HP of Enterprise Group (is responsible for release of servers, disk storages and other corporate solutions), said that from the moment of creation of the enterprise, joint with Foxconn, in May, 2014 until the beginning of June of the 2015th, purchase orders of servers for the amount more than $1 billion are received. In the most large deal the customer purchased the equipment for $200 million, the top manager of HP noted, without having told the name of the buyer.

In a year the server joint venture HP and Foxconn earned more than $1 billion

"It became great success. We concluded a huge number of large contracts worldwide" — Antonio Neri told, having added that among clients of the joint venture there are also Chinese companies.

Taking into account that the volume of all server business of HP in 2014 financial year reached $12.5 billion, partnership with Foxconn does not bring to the American corporation a large income. At the same time, as notes Bloomberg, $1 billion earned from joint servers say that HP learned to sell such equipment to the world's largest operators of computing powers, such as Google which in search of cheap solutions, as a rule, address Asian ODM suppliers, like Quanta Computer.

They offer not branded (white-box) servers costing much cheaper in comparison with the systems of large vendors (HP, Dell, etc.) as they do not demand big R&D-инвестиций and runtime royalty fees. Besides, solutions of ODM manufacturing are deprived of unnecessary technologies and easily adapt under specific objectives and loadings, from here and the growing demand for these products from Google, Microsoft, Facebook and other cloud providers.

"Not all suppliers of services buy from ODM manufacturing. Google does it and some other. Microsoft makes purchases at the ODM companies and at us" — the head of HP Meg Whitman reported.

It also recognized that the enterprise, joint with Foxconn, brings to HP a small margin, however this business is profitable and fast-growing.^[9]

HP increases the staff abroad

On June 4, 2015 it became known that Hewlett-Packard (HP) company purposefully to aim to increase number of staff outside the USA to achieve economy and to stimulate development of innovations.

According to Bloomberg with reference to the website of HP, quantity of the vacancies opened by the company by the beginning of June, 2015 makes about 2500 in the USA and 4700 in other countries of the world. Higher set of employees abroad on the one hand confirms superiority of foreign revenue over American (65% to 35%) in sales pattern of vendor, with another — says about desire to save during business transformation within which by November 1, 2015 by HP it will be divided into two companies (HP Inc. and HP Enterprise).

Digits on the card indicate number of open vacancies of HP in a certain country

Follows from an illustration which was prepared by observers of Bloomberg on the basis of data of HP that the company recruits most of all employees in India (1425). Besides, the vendor intends to employ 391 persons in Mexico, 380 — in China, 261 — in Brazil. In other words, HP stakes on emerging markets where labor power is cheaper, than in the developed countries.

Besides, the American corporation conducts numerous researches outside the home region therefore there it needs talented and experienced engineers. The edition calls HP the only large western IT company which in such countries as China, India, Bulgaria and Costa Rica, looks for on responsible R&D-должности specialists among local population.

"Emerging markets, as a rule, grow quicker than American. We need more people where we intend to extend" — the CEO of HP Meg Whitman reported.

According to her, the staff increase of employees in the states with developing economy helps HP to cut down expenses and, as a result, it is better to compete with IBM, Huawei, EMC and Lenovo.

Regions will play more important role for HP after the personnel restructuring started in 2012. This program assumes reduction of the staff of the company on 55 thousand people until the end of 2015. The producer does not specify in what ratio the liquidated and created working positions between HP Inc will be divided. and HP Enterprise, however is already known that the division of corporate IT services (HP Enterprise Services) will strongly suffer. The company fights against high labor costs there in the countries which in itself require big costs for business, the head of HP of Enterprise Services Mike Nefkens noted.

Due to reduction of IT-Business of HP hopes to save about $2 billion. $1 billion more is going to be saved as a result of carrying out restructuring.^[10]

HP will pay shareholders $100 million for scandalous purchases not to go under court

The Hewlett-Packard company agreed to pay to the shareholders compensation in the amount of $100 million in exchange for a withdrawal of the claim connected with acquisition of software developer of Autonomy in 2011. The called compensation amount is 10 times less in comparison with original requirement^[11].

According to conditions of the arrangement, HP will transfer $100 million in special fund then this money will be distributed among shareholders of the company who acquired shares during the period from August 19, 2011 to November 20, 2012. In turn, the claimant undertakes to withdraw all complaints connected with securities concerning current and former top managers of Hewlett-Packard, heads and consultants. Obligation fulfillment will follow after the court considers and will approve the HP solution.

As representatives of HP comment, the company does not admit the guilt. However in HP considered that such outcome will be the best option of succession of events, otherwise the lawsuit can seriously will drag on, and as a result of an effect will be less favorable for all parties.

HP enters a strict dress-code

On July 24, 2015 it became known of introduction to HP of a strict dress-code for employees. To men prohibited to wear t-shirts which are especially popular among programmers of Silicon Valley.

According to the The Register edition, the guide of HP sent to the employees working worldwide (Great Britain, Australia, India, Germany, the USA, etc.), the e-mail in which requirements to clothes are designated.

In particular, the males employed in HP cannot come to work in t-shirts, shorts, baseball caps and other headdresses now and also in sports things and open footwear. Girls are forbidden to put on short skirts, dresses with deep notch, a shoe on a high heel and there is too much jewelry. Besides, nobody can wear shabby or ripped jeans.

Decided to enter a dress-code as the unseemly appearance of personnel, according to the management, can affect labor productivity into HP and distract the clients coming to offices of the company.

It is curious that new requirements to clothes concern not only sales managers who constantly should communicate with the potential and acting clients, but also workers of "the invisible front", including developers and the staff of research departments.

Men are recommended to come to work in a suit with a tie, and to women — "to look as much as possible presentable". When choosing clothes the company asks to be guided by "simple common sense" and not to put on "something too bright or negligent".

Employees of HP already began to express discontent with new rules to appearance in Twitter blogs.

It should be noted that the dress-code in HP matched separation of the company into two — HP Inc. and HP Enterprise. Independent work of two new firms will begin in August, 2015 though formally separation of corporation will happen on November 1.^[12]

Dismissal of every fifth employee

On August 20, 2015 it became known of plans of HP to dismiss more employees, than it was expected initially. This increase in the program of reductions will become not the first.

In 2012 HP started personnel restructuring within which at first it was going to reduce number of staff by 27 thousand human. Then the company repeatedly increased the number of reductions, and as a result it reached 55 thousand.

At the conference which took place on August 20, 2015 devoted to the publication of the report of HP for the third financial quarter (came to the end on July 31 the 2015th), the financial director of the American producer Cathie Lesjak said that during the reporting period the company was left by 3900 employees. As of June, 2015 the staff of HP was lowered on 51.9 thousand people from the planned 55 thousand. However the last digit can grow by 5%, Lesjak reported, having added that additional dismissals will not lead to growth of the expenses which are rather expected.

According to the Business Insider edition with reference to the documents published by HP, the company intends to complete personnel restructuring in October, 2015, having spent for it in total $5.5 billion.

The end of large-scale liquidation of working positions will match official separation of HP into two companies. On November 1, 2015 instead of HP HP Inc will appear . and HP Enterprise which will probably increase set of new employees as the companies should create two headquarters, two positions of the chief financial officer, two personnel departments, etc.

The head of HP Meg Whitman confirmed that the company can reduce more people, than 55 thousand. At the same time in this respect the top manager did not give additional details, promising to open them during the meeting with analysts of Wall Street which is scheduled for September 15, 2015.

Madam Uitmen also noted that large-scale dismissals in HP are the last stage of restructuring of division  Enterprise Services within which the company renders services of consulting and outsourcing.

The most part of dismissals fell on this division. The structure of Enterprise Services appeared in 2008 as a result of purchase of EDS company on which completion the staff of HP doubled. As of August, 2015 in the American corporation about 300 thousand people work.^[13]

Theft of $1 million by the assistant administrator

On August 24, 2015 it became known that the former assistant to one of top managers of HP was sentenced to imprisonment for plunder of money from accounts of the American company. It became clear that the swindler spent the stolen money for expensive rest. Holli Dawn Coulman who from 2000 to 2012 worked as the assistant to one of the senior vice presidents of HP secretly paid personal expenses at the expense of the employer.

Official separation of HP

On November 2, 2015 there was official separation of the American producer of the HP computer equipment into two companies. Experts are sure that this split finally will lead to merger of newly made firms while in the management convince of the return.

On November 2, 2015 instead of one HP in the market two companies appeared: HP Inc. (computers and printers) and Hewlett Packard Enterprise (HPE) (corporate solutions). Shares of the last were placed on the New York exchange under a ticker of HPE, and HP Inc. saved designation of HP — HPQ — on the same marketplace.

At opening of biddings of the stock Hewlett-Packard Enterprise grew in price for 3%, however during the day positive dynamics was replaced negative, and falling of quotations of the company reached 5.8%. By the end of the substantive exchange session securities of Hewlett-Packard Enterprise won back recession a little and fell in price by 1.6% of rather starting value — up to $14.49. Market capitalization of vendor made $27.21 billion.

On the contrary, showed to HP Inc. positive growth rates. When opening the exchange of a stock of this company jumped by 14.4%, and according to the results of trading day their cost increased by 13% up to $13.83 that corresponds to market capitalization of HP Inc. in $48.5 billion^[14]

Hewlett-Packard Enterprise was headed by the CEO of HP Meg Whitman. Head of HP Inc. there was a vice president of division for release of computers and HP printers Dion Weisler.

The staff of Hewlett-Packard Enterprise made 252 thousand employees while in HP Inc. there are about 50 thousand human. However the last is more profitable: for the last year she received $57.3 billion revenue against $53 billion at Hewlett-Packard Enterprise.

Separation of HP is profitable to HP Inc. from that position that this company will not need to spend profit on highly profitable sales of printers for corporate IT-Business now. HP Inc. she intends to allocate the released funds for increase R&D-ресурсов and return of the capital to investors in the form of dividends.

According to the analyst of UBS Steve Milunovich, in the near future crushing of HP will favorably affect business of the new companies, however in the long term they can become an easy target for absorption.

"In the near future there will be two companies which will not be neither consolidators, nor consolidated" — parries Meg Whitman.

2019: The former financial director of Autonomy is sentenced to 5 years of prison for fraud before the transaction with HP

On May 13, 2019 the former chief financial officer of Autonomysushovan Sushovan Hussain was sentenced to 5 years of imprisonment for fraud before the conclusion of the transaction within which the company was sold to producer of the computer equipment Hewlett-Packard for $11.1 billion in 2011. Read more here.

See Also

• HP Inc.
• Hewlett Packard Enterprise (HPE)

Notes