HP Revenues Hurt by Slowing PC, Server Demand
“During his tenure at HP, he has run HP Software, held the responsibility of chief strategy officer and for over 15 months has served as HP's chief operating officer,” Whitman said. “As COO, Bill helped to create HP's blueprint for the future and deeply understands the strategic challenges and opportunities facing both the company and its customers. As hardware becomes more standardized, leadership solutions are increasingly differentiated by the software layer that drives the hardware. This is true for both traditional IT and cloud environments.” The executive switch comes two months after Whitman removed Todd Bradley as head of the PC business, replacing him with former Lenovo and Acer executive Don Weisler, who had been with HP as senior vice president in Asia. Despite the disappointing quarterly numbers, Whitman noted that the company is continuing to reduce its expenses, thanks in large part to the 29,000 job cuts announced last year as part of the larger turnaround strategy. And she is optimistic about the company’s future. “Overall, I would say, our turnaround continues,” Whitman said. “We are moving forward against our plans and I remain comfortable with where we are heading.”“HP’s turnaround will happen on the back of great products and services,” she said. Some analysts said that while HP is working to expand its product portfolio, executives still must figure out how to deal with the continued problems in PCs and industry-standard servers. “HP continues to control expenses and reallocate savings to fund lucrative, unified product, service and solution initiatives that allow HP to grow profit despite declining revenue,” Jack Narcotta, an analyst with Technology Business Research, said in a research note. “The strategies implemented by CEO Meg Whitman and her executive team have not provided remedy to triage shrinking market share and declining revenues. HP has yet to prove it can grow its non-PC and server business to offset staunch declines in those two industries, and a hyper-competitive pricing environment that will persist through 2014 will limit HP’s ability to rebound from its downward growth trajectory.”
She added that even with all the cost-cutting and reorganizing, the key will be what HP sells to customers.