3PAR Storage Division Helped Save HP's Q4 Earnings Bacon

 
 
By Chris Preimesberger  |  Posted 2011-11-23
 
 
 

The pressure was heavy this week on Hewlett-Packard to show some sort of good news in its quarterly earnings report, following what has to be the most frustrating year in the company's 72-year existence.

Well, let us clarify that: 2011 might have been the most frustrating "messaging" year for the venerable and respected IT company, with its high-level leadership changes, product flops, killing of a division (Palm), "forward-looking" strategy announcements (and subsequent U-turns on them), and so on. The company still brought in billions, so it wasn't frustrating in the financial sense.

But through it all, the HP storage division has been a rock. In Q4 2011, storage revenues reached $1.09 billion, up 4% year to year and 11% sequentially. For the fiscal year, storage division growth was 7%, rising from $3.8 billion to $4.1 billion.

This is strictly hardware and does not count software and services that go with it. You can add a lot more income based on those transactions.

Most of this can be attributed to the acquisition of 3PAR and not necessarily to the company's longtime StorageWorks line, EVA or XP (which HP OEMs from Hitachi Data Systems through a joint agreement). HP rolled out its first branded 3PAR storage system last March following the August 2010 acquisition for $2.3 billion after a bidding war with Dell, and sales immediately began taking off.

HP as a whole saw its revenues only increase by 1 percent this quarter. If the 3PAR-led storage division hadn't performed as it had, that 1 percent number would have been in negative territory.

Turns out the HP-3PAR virtualization-ready, auto-tiering/thin-provisioning-focused systems are in demand -- not only by midrange companies, but by larger enterprises who use them for divisional-type duty.

So that deal -- the largest to date for a storage software company -- is already paying dividends for the mothership. At the time of the bidding war, people talked a lot of smack about HP ultimately having to double its original bid for 3PAR, but the acquisition will pay for itself in short order, don't worry about that.

Congratulations are certainly in order for storage division field general Dave Donatelli, 3PAR division head honcho David Scott, marketing whiz Craig Nunes, and all the HP storage merry men and women.

And have a Happy Thanksgiving, one and all!

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