Hewlett-Packard’s making the Most out of its Security Portfolio
HP, like many tech companies, has its hands in a few pots as the industry shifts to a broadened space spanning mobility and the enterprise. We’ve been covering Hewlett-Packard’s strategy to tap the growing and modestly tapped enterprise security market for quite some time. A new note by ISI analyst Brian Marshall further validated the approach this morning by rounding up the company’s investments so far.
Hewlett-Packard’s most recent big buys in this area include the $1.5 billion ArcSight deal and the acquisition of 3COM for $2.7 billion. HP was quick to integrate the firms into the company, launching a new offering, the ArcSight Express 3.0 enterprise network monitor, in September.
HP spent a lot and is seeing steady return, Marshall reported in his note, quoted here from AllThingsD.
“Marshall writes that HP’s security assets bring in about $1.5 billion in sales and are growing at about 30 percent year, with gross profit margins in the neighborhood of 80 percent. This compares favorably with security outfit Check Point, which trades at a multiple of about 10 times sales, Marshall says.”
AllThingD’s Arik Hesseldahl put the numbers together: if all of Hewlett-Packard’s security assets are worth upwards of five times sales and the company will manage to generate revenue of about $2 billion in 2012, it would mean that the company’s security business is worth one fifth of its market cap.
Hewlett-Packard is seeing a big opportunity in security, stretching across a number of sectors. Rebecca Lawson, worldwide director, security and cloud solution marketing for HP Enterprise Security discusses this during an interview with our own Kristen Nicole, highlighting the main aspects of her company’s vision. Among those were cloud security and cyber threats, which HP’s Archie Reed discussed extensively in an interview at theCube with John Furrier and Dave Vellante. They later spoke to Hewlett-Packard’s worldwide security director Michael Callahan and Johnny Hernandez, director of information security at Prime Lending, during HP Discover 2011.
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