Hewlett-Packard had a pretty unusual earnings call this week, considering that the company used it as an opportunity to reveal some major internal changes.  After reporting fairly flat results, mainly due to declining demand in the PC space and a number of other factors, HP essentially stated it’s on a path to become something more similar to Oracle than the consumer device manufacturer it’s portrayed as today.

The company decided to go after the enterprise software market instead of investing more in the low-margin hardware market, and said it plans on spinning off its PC business.  Its software unit’s margins are by far the highest compared to other groups, but the problem is that HP is still a relatively new player in this space.  This is where its acquisition of Autonomy comes in.

From eWeek;

“Autonomy knows how to store data, archive it, access it, find it, report on it, analyze it and return it to where it should be kept for all eternity. And it plugs right into cloud systems.

HP can do most of this now, but not in a form that can be distributed natively by a cloud system. That’s essentially what this move is all about.”

CEO Leo Apotheker, the man spearheading the transformation, needs Autonomy to solidify the company’s already broad software portfolio.  Autonomy is the second largest software developer in the U.K, and HP agreed to shed out $10.3 billion for the deal, despite of a string of unprofitable acquisitions that took place throughout the past two years.

John Furrier and Alex Williams discussed how, despite this, the company does have the potential to become a major software vendor.  The two main reasons are that Leo Apotheker served as SAP’s CEO for an extend periods of time, and strong management, according to Furrier.