HP shakes up management amid 8% revenue slide
SAN FRANCISCO — Hewlett-Packard yesterday replaced Mr Dave Donatelli with Mr Bill Veghte at the helm of its second-largest business division as it reported a larger-than-expected 8 per cent slide in third-quarter revenue.
The world’s largest PC-maker recorded revenue of US$27.2 billion (S$35 billion) in the fiscal third quarter, down from US$29.7 billion a year earlier, as PC sales continued to slide amid a shift towards mobile computing and with HP’s enterprise business grappling with tepid worldwide information technology spending. It missed the US$27.3 billion in sales that Wall Street had expected on average.
Mr Donatelli, a rising star that Wall Street analysts once considered a candidate for a tech CEO position, relinquishes his post as chief of the Enterprise Group, which sells server, storage and software services to large organisations. He will now focus on identifying early-stage technologies for investment.
Mr Veghte, HP’s Chief Operating Officer who once headed the business side of Microsoft’s Windows unit, takes over immediately.
The Enterprise Group is HP’s largest business unit after personal computers, and is a critical component of Chief Executive Meg Whitman’s efforts to boost margins and profitability. The division, which recorded a 9 per cent decline in sales in the second quarter, accounts for about a quarter of the company’s overall sales.
Overall net income in the quarter came to US$1.39 billion or 71 US cents a share, from an US$8.9 billion loss a year earlier when the company swallowed a big writedown of the IT outsourcing business it inherited when it bought Electronic Data Systems for close to US$14 billion in 2008.
Excluding one-time items, the company earned 86 US cents a share, matching the average forecast of analysts polled by Reuters. AGENCIES