HP Expected To Post $9B Quarterly Loss, Holds Focus on Services and Tablets
Hewlett-Packard’s CEO Meg Whitman is doing her best to keep her company afloat but it seems like HP just can’t get a break. They’re expected to post a major quarterly loss after the stock market closes later today.
According to HP, the situation is not that bad if you disregard accounting rules that require them to reflect the diminished value of past acquisitions, such as the $13 billion acquisition of technology consulting firm Electronic Data Systems, which hasn’t benefitted the company as they’d envisioned.
Earlier this month, they projected an anticipated loss of $4.31 to $4.49 per share for the fiscal third quarter or about $9 billion in quarterly loss. HP also has to account for the severance pay for the first wave of the 27,000 jobs that will be cut in the next two years.
HP stated that they would’ve made money if those factors weren’t considered. The company is trying to make up for losses by selling more consulting services, software and high-end servers as their PC business is no longer profitable like it was before.
Another shot at the tablet market
Apple and Samsung took a huge bite out of the PC sector, as more people gain interest in buying powerful tablets that could be as a reliable replacement for the laptop or netbook. So later this year, when Microsoft launches its Surface tablet and a lot of OEMs will also be launching their own Windows RT tablets, HP will be one of them. Yes, they’re trying their luck in the tablet market one more time. The question is, can they measure up to the hordes of tablets that will only continue to flood the market?
According to Travis Fisher, executive vice president at Inacom Information Systems, an IT solutions provider Salisbury, HP cannot compete with Apple in the tablet market as they didn’t stick to their guns in their effort to establish a name for the TouchPad.
“I didn’t think the TouchPad was a bad device but they weren’t willing to stick with it and build market share. You have to have an ecosystem and be in it for the long haul,” Fisher said, referring to the iPad.
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