9 ms·

HP to Keep PC Division

63 points by sl_ 15y ago

barredo 15y ago
Will they keep WebOS?
- jinushaun 15y ago
  HP has clearly shown they are not good caretakers of WebOS. They best thing they could do is sell it off to someone who could make better use of it. Amazon? Although with the launch of the Fire, they're pretty much stuck on Android now...
  - stinkytaco 15y ago
    I don't see why they're stuck on Android. The Android part is pretty hidden and if Amazon has shown an ability to do anything, it's to make wholesale changes without burning the place down. They also can sit on a property until they are ready for it (see: Slow integration of Audible, Goodreads). Indeed, it's possible they would like to get off Android to avoid being beholden to Google.
    - cpeterso 15y ago
      What would Amazon gain from purchasing webOS from HP? I don't see much webOS value for Amazon except Palm patents (to defend the Kindle Fire from Apple patent attacks). Amazon has invested in their own Android App Market and then the Kindle Fire. They have the talent and money to support their own fork of Android (which seems like a possibility) if Google were to stop open-sourcing Android.
      - stinkytaco 15y ago
        Few days on, but I see it similar to how Google felt the need to make Chrome rather than to simply rely on Firefox. If you're selling a property (in this case web services and advertising), wouldn't you want to control every aspect of how that property is viewed? Google wanted to have full control over how users saw their product, so they can make a browser and fully support that browser with all the bells and whistles their product can conceivably offer through that platform. Amazon is the same way. Their device is secondary to the content they are offering, so why not be able to tailor that device fully to the content. The only way you can ever truly make that a reality is if you have your own platform. Of course, even if this is all wrong, it’s not like WebOS will cost that much money. It’s like Amazon picking up a book at the bookstore, it looks interesting, you probably won’t ever read it, but it looks pretty and doesn’t take up space and you can send it off to the thrift store in a couple of years.
- The_Sponge 15y ago
  Unlikely. Besides the fact that almost no one actually has any faith in it as a platform due to the way HP dropped it, even if they did do a 180, people would still have shaken confidence. Not to mention that there are currently no currently officially selling WebOS devices (except for a few straggling phones in the discount bin), nor plans for new ones. And, when your competitors are Android, WP7, and iOS, getting over the vicious cycle of "no developers making apps which means no people are buying apps which means that no developers are making apps..." is just too much. Even Android was struggling with that and still is on the tablet side even with the Google juggernaut behind it. Plus, even in printers and lower end devices and phones like that, WebOS is overkill. Samsung's Bada and Android are crowding that market too tightly, not to mention Symbian. Maybe we'll see WebOS as an "instant boot" option on a few HP PC models for which it was already in development but that doesn't really count. There's no future for WebOS. It's dead. When your competitors are Microsoft, Google, and Apple, and they already have entrenched hardware and software products in the same market that are innovative and being actively developed, and are directly competing against yours, and are having far more money pumped into them, and have thriving ecosystems, and haven't been officially been killed off, you may just be best off going home.
  - firefoxman1 15y ago
    I'm sure you could find dozens of articles from 1996-1998 saying similar things about Apple, but imagine how different the world would be if Jobs listened to them and just declared Apple "dead" and didn't return to the company. WebOS is a great platform and it's not too late to save, but it needs a better company than HP to breathe new life into it. In my opinion, it's much better than iOS for tablets and larger devices (the perfect TV?) but the clock is ticking. Every day HP wastes with decisions like "should we kill one of our largest sources of revenue?" Apple is right next door developing amazing products for tomorrow like Siri.
    - ScottBurson 15y ago
      In fairness, HP never proposed to "kill one of its largest sources of revenue". The idea was to get some cash by selling or spinning off a relatively low-margin division. Killing it would be ridiculous. IBM certainly didn't "kill" its PC division; Lenovo is now the #2 vendor.
- thought_alarm 15y ago
  WebOS has suffered from severe performance and stability problems for three years, with no solution in sight. This was demonstrated both when the WebOS application layer received a 2X performance boost when ported to WebKit on iOS, and again when Android was ported to the TouchPad hardware and was found to be quite a lot faster than WebOS. It's quite clear that it is a fundamentally flawed architecture without a future. It's too bad; there's some interesting stuff going on in the application layer, but the underlying OS is a complete turkey.
  - ScottBurson 15y ago
    Agreed (as a former Pre user). I think they should rip out whatever kernel they're using and replace it with BeOS, which has wonderful real-time and multitasking behavior.
    - deleted 15y ago
      [deleted]
  - soapdog 15y ago
    It was not "WebOS Application layer" that was ported to WebKit on iOS, it was a simple Enyo app running. WebOS is a great OS. I have a Nexus S and an iPhone but I still use my old Palm Pre2 because I think the usability of WebOS is far greater than iOS or Android (and I am a developer for both platforms). People tend to dismiss WebOS without ever touching a device. Yes, my Pre2 is not as fast as my Nexus S but guess what, for my daily tasks of emailing, web, agenda, evernotes and ebooks it is GREAT! The OS has a better experience and the development framework rocks. Enyo is wonderful, I wish it was open source. You speak of a flawed architecture, I just see a beautiful system with a wonderful paradigm (the cards) that is aesthetically pleasing and a joy to develop for. If I could get my hands on a Pre3 or a TouchPad, I would buy it instantly but unfortunately, they are not available here.
InclinedPlane 15y ago
Personally, this fiasco seemed to me to mirror Netflix's recent missteps, just with far less press.
- Samuel_Michon 15y ago
  "You know what HP should do? They should acquire Netflix. Then a week later back away and say “Never mind.” Then a month later go ahead and buy Netflix. Those two are made for each other." –John Gruber
redorb 15y ago
This decision is better than their CEO pick (meg whitman) but these big decisions affect each other... I don't see much future but decline for HP
- reissbaker 15y ago
  Kinda makes me like Whitman more, though. Wish she'd been around before the WebOS disaster.
  - ScottBurson 15y ago
    The only credit I give Whitman for this is that she realized that the markets (both PC customers and the stock market) had already spoken, and they did not like the spinoff plan. Analysts had already pointed out that existing synergies (the supply chain, etc.) would be lost. I think it was pretty much a foregone conclusion that the spinoff decision would be reversed, although I'll grant Whitman the benefit of the doubt and assume that she really did study the question deeply and with an open mind. I doubt she would have reversed the WebOS decision even if she had had the chance. As much as we techies may bemoan it, the fact is that for HP to see any profit from the Palm acquisition, it would have had to suffer losses for several years and then try to recoup them in an extremely competitive environment (read: low margins). I think the real mistake there was when Hurd bought Palm in the first place, and I see no evidence that anyone in HP's upper management thinks otherwise.
mrich 15y ago
Wow. What is going on there? At first I thought Apotheker was hired to complete some "unpopular" tasks, and then a new CEO could start over. But it seems like the board was completely asleep while Apotheker made his decisions. I am looking forward to some massive lawsuits brought against these people. Apotheker probably was the most clever guy in this, and knew that he could make a quick 20 million even though he would be fired. Would be interested in insights from HP employees.
- sliverstorm 15y ago
  I suddenly find myself wondering if someone wanted the stock price to crater, to make a takeover or mega-buy-in cheaper.
  - pedalpete 15y ago
    Interesting theory, and with the history of this HP board, this is actually a very minor possibility. http://en.wikipedia.org/wiki/Hewlett-Packard_spying_scandal http://en.wikipedia.org/wiki/Hewlett-Packard_spying_scandal You've made me wonder if the quality of the algorithms used for trading make it near impossible for the SEC to track these sort of criminal activities.
- thefreehunter 15y ago
  Lawsuits for what?
  - bluedanieru 15y ago
    For not performing due diligence when discussing the company's strategy with the new CEO, leading to about two years of fucking around (after a decade of fucking around) and cratering the company's value to the shareholders.
    - kb101 15y ago
      Unfortunately, the board is close to dysfunctional. http://www.reuters.com/article/2011/09/22/us-hp-board-insight-idUSTRE78L4M020110922 http://www.reuters.com/article/2011/09/22/us-hp-board-insigh... http://www.nytimes.com/2011/09/22/business/voting-to-hire-a-chief-without-meeting-him.html http://www.nytimes.com/2011/09/22/business/voting-to-hire-a-...
w33ble 15y ago
First good decision they've made in a while. Too bad they are unlikely to reverse the WebOS decision. I have to wonder how much this had to do with not finding anyone to buy it at a price they were willing to take.
codezero 15y ago
With all the bad moves HP has made recently, this is a good one. Although my testimony is likely not worth much, I feel it's important to convey why I think HP's PC division is worth keeping around. My boss' HP desktop died, he brought it to me to see if I could fix it quickly, and I went through the steps on HP's website to "troubleshoot" it. I was pretty sure the power supply was dead, and I sent an email to support explaining all the steps I went through to determine that. There was an option on the page to list experience level, and I put it at the max. The first response I got was that they would send a shipping box for it and that they would replace the PSU. They 1) trusted their customer and 2) didn't back and forth, wasting their time and mine. I got the box within a few days and returned the system to HP. It was back within 3 days (this is a week total from initial contact to returned system), and the hard drive wasn't even reformatted. This is the kind of service that I am used to from Apple (fix it and forget it), and it renewed my hope in HP, but this was a little over a year ago, so who knows what's going on now.
- martey 15y ago
  While I have heard good things from a couple of people about HP's business support, my personal experiences with their consumer support division have been wanting. My HP laptop has a locked BIOS that prevents you from replacing the wireless card. I sent them an email message describing the BIOS error message that was returned and asking for more information about what were valid wireless cards for the machine. I received a reply telling me to reinstall my wireless card drivers. Over the next few days, I tried to get someone who understood my issue, but was repeatedly told to reinstall drivers, to reseat the card, and a variety of other solutions that seemed to come from some wireless troubleshooting customer support script. I called, and the person I talked to eventually told me to send the computer in, because "the depot would have a different unlocked BIOS that they could put on". When my computer arrived at the depot, I talked to: - a technician who was sympathetic but very confused about why phone support told me to send my computer to the depot, - two case managers who started out by telling me that they were "non-technical" who I had to explain what a BIOS was, and - a rude senior case manager who yelled at me for wasting everyone's time and told me "if you bought a car with a Sony stereo, you wouldn't expect a Panasonic stereo to work in it". When I told him that he was being rude and I wanted to provide feedback to someone about it, he told me that there was nobody else I could talk to, as his superiors would not want to hear from me. After a day of not hearing anything from the depot about when my computer would be returned, I called a HP executive support number I found on Consumerist or some other forum. The woman I talked to was exceedingly polite, but admitted she was non-technical, but then told me that my issue was "it was because HP wanted it that way" and even though it is in a user-accessible location, trying to install a different wireless card would void my warranty "just like installing Linux." A week or so later, HP released a BIOS update to include more wireless cards on the internal whitelist, in order to support the version of the laptop in the Small Business store (same components, starting price was $300 higher).
trolleycar 15y ago
I don't understand why HP was so public about this decision-making process. Perhaps it wasn't intended, and the original story was leaked? Seems like a good study: see if PSG should be spun off, but I can see no reason to make it public.
aresant 15y ago
Understanding HP's dilemma is as simple as looking at the comps. HP is trading at 6.5x P/E currently. Yet HP's consulting business should be worth more separate (IBM at 14x, Accenture at 18x) And HP's hardware business should be worth more separate (compare Toshiba at 12x, Apple at 15x, even Dell at 9x) As a result I understand why they allowed Apotheker to do what he did. Cut ONCE, bleed heavily and launch two strong, focused companies that aren't burdened by the distraction of the other and can unlock maximum shareholder value. BUT wow, do they have a fricking communication challenge. Every press release (even this one) is dry, complicated and nonsensical. The current press release talks about a "data driven decision". Why can't they just explain what they're doing and why? Come on HP.
- chugger 15y ago
  I agree. HP's hardware business is dragging down its stock price. this is one of the reasons why IBM sold off its PC division to Lenovo. Services and software usually provide a return on invested capital of 30 percent or more, compared to 15-20 percent for hardware. IBM's ROIC is currently at 34.1% compared to HP's ROIC at 16.2%. After IBM sold off its PC division to Lenovo in 2005, IBM's ROIC grew from 17.75% in 2006 to 29.55% in 2010 with a 5 year average of 27.6%.In comparison HP's 5-year average ROIC is only 15.9%. HP wanted to do the same thing IBM did 7 years ago. The big difference was that before selling off its PC division, IBM already had a strong software and services business (generating half of its revenue). they also bought PriceWaterHouseCoopers' consulting arm in 2002. HP's software and services business isn't nearly as strong, even after buying Autonomy so they got clobbered by analyst and the media.
- nobody314 15y ago
  Splitting off HP's hardware business doesn't suddenly make it worth the same as Apple's That's like claiming if it spun off it's discount coupon business it would be worth the same as groupon.
  - pedalpete 15y ago
    He did provide PE ratios for competitors as well, and HP is the largest PC maker. He isn't valuing them the same as Apple, just that the PE ratio should be similar.

63 points by sl_ 15y ago

barredo 15y ago

Will they keep WebOS?

jinushaun 15y ago
HP has clearly shown they are not good caretakers of WebOS. They best thing they could do is sell it off to someone who could make better use of it. Amazon? Although with the launch of the Fire, they're pretty much stuck on Android now...
- stinkytaco 15y ago
  I don't see why they're stuck on Android. The Android part is pretty hidden and if Amazon has shown an ability to do anything, it's to make wholesale changes without burning the place down. They also can sit on a property until they are ready for it (see: Slow integration of Audible, Goodreads). Indeed, it's possible they would like to get off Android to avoid being beholden to Google.
  - cpeterso 15y ago
    What would Amazon gain from purchasing webOS from HP? I don't see much webOS value for Amazon except Palm patents (to defend the Kindle Fire from Apple patent attacks). Amazon has invested in their own Android App Market and then the Kindle Fire. They have the talent and money to support their own fork of Android (which seems like a possibility) if Google were to stop open-sourcing Android.
    - stinkytaco 15y ago
      Few days on, but I see it similar to how Google felt the need to make Chrome rather than to simply rely on Firefox. If you're selling a property (in this case web services and advertising), wouldn't you want to control every aspect of how that property is viewed? Google wanted to have full control over how users saw their product, so they can make a browser and fully support that browser with all the bells and whistles their product can conceivably offer through that platform. Amazon is the same way. Their device is secondary to the content they are offering, so why not be able to tailor that device fully to the content. The only way you can ever truly make that a reality is if you have your own platform. Of course, even if this is all wrong, it’s not like WebOS will cost that much money. It’s like Amazon picking up a book at the bookstore, it looks interesting, you probably won’t ever read it, but it looks pretty and doesn’t take up space and you can send it off to the thrift store in a couple of years.
The_Sponge 15y ago
Unlikely. Besides the fact that almost no one actually has any faith in it as a platform due to the way HP dropped it, even if they did do a 180, people would still have shaken confidence. Not to mention that there are currently no currently officially selling WebOS devices (except for a few straggling phones in the discount bin), nor plans for new ones. And, when your competitors are Android, WP7, and iOS, getting over the vicious cycle of "no developers making apps which means no people are buying apps which means that no developers are making apps..." is just too much. Even Android was struggling with that and still is on the tablet side even with the Google juggernaut behind it. Plus, even in printers and lower end devices and phones like that, WebOS is overkill. Samsung's Bada and Android are crowding that market too tightly, not to mention Symbian. Maybe we'll see WebOS as an "instant boot" option on a few HP PC models for which it was already in development but that doesn't really count. There's no future for WebOS. It's dead. When your competitors are Microsoft, Google, and Apple, and they already have entrenched hardware and software products in the same market that are innovative and being actively developed, and are directly competing against yours, and are having far more money pumped into them, and have thriving ecosystems, and haven't been officially been killed off, you may just be best off going home.
- firefoxman1 15y ago
  I'm sure you could find dozens of articles from 1996-1998 saying similar things about Apple, but imagine how different the world would be if Jobs listened to them and just declared Apple "dead" and didn't return to the company. WebOS is a great platform and it's not too late to save, but it needs a better company than HP to breathe new life into it. In my opinion, it's much better than iOS for tablets and larger devices (the perfect TV?) but the clock is ticking. Every day HP wastes with decisions like "should we kill one of our largest sources of revenue?" Apple is right next door developing amazing products for tomorrow like Siri.
  - ScottBurson 15y ago
    In fairness, HP never proposed to "kill one of its largest sources of revenue". The idea was to get some cash by selling or spinning off a relatively low-margin division. Killing it would be ridiculous. IBM certainly didn't "kill" its PC division; Lenovo is now the #2 vendor.
thought_alarm 15y ago
WebOS has suffered from severe performance and stability problems for three years, with no solution in sight. This was demonstrated both when the WebOS application layer received a 2X performance boost when ported to WebKit on iOS, and again when Android was ported to the TouchPad hardware and was found to be quite a lot faster than WebOS. It's quite clear that it is a fundamentally flawed architecture without a future. It's too bad; there's some interesting stuff going on in the application layer, but the underlying OS is a complete turkey.
- ScottBurson 15y ago
  Agreed (as a former Pre user). I think they should rip out whatever kernel they're using and replace it with BeOS, which has wonderful real-time and multitasking behavior.
  - deleted 15y ago
    [deleted]
- soapdog 15y ago
  It was not "WebOS Application layer" that was ported to WebKit on iOS, it was a simple Enyo app running. WebOS is a great OS. I have a Nexus S and an iPhone but I still use my old Palm Pre2 because I think the usability of WebOS is far greater than iOS or Android (and I am a developer for both platforms). People tend to dismiss WebOS without ever touching a device. Yes, my Pre2 is not as fast as my Nexus S but guess what, for my daily tasks of emailing, web, agenda, evernotes and ebooks it is GREAT! The OS has a better experience and the development framework rocks. Enyo is wonderful, I wish it was open source. You speak of a flawed architecture, I just see a beautiful system with a wonderful paradigm (the cards) that is aesthetically pleasing and a joy to develop for. If I could get my hands on a Pre3 or a TouchPad, I would buy it instantly but unfortunately, they are not available here.

InclinedPlane 15y ago

Personally, this fiasco seemed to me to mirror Netflix's recent missteps, just with far less press.

Samuel_Michon 15y ago
"You know what HP should do? They should acquire Netflix. Then a week later back away and say “Never mind.” Then a month later go ahead and buy Netflix. Those two are made for each other." –John Gruber

redorb 15y ago

This decision is better than their CEO pick (meg whitman) but these big decisions affect each other... I don't see much future but decline for HP

reissbaker 15y ago
Kinda makes me like Whitman more, though. Wish she'd been around before the WebOS disaster.
- ScottBurson 15y ago
  The only credit I give Whitman for this is that she realized that the markets (both PC customers and the stock market) had already spoken, and they did not like the spinoff plan. Analysts had already pointed out that existing synergies (the supply chain, etc.) would be lost. I think it was pretty much a foregone conclusion that the spinoff decision would be reversed, although I'll grant Whitman the benefit of the doubt and assume that she really did study the question deeply and with an open mind. I doubt she would have reversed the WebOS decision even if she had had the chance. As much as we techies may bemoan it, the fact is that for HP to see any profit from the Palm acquisition, it would have had to suffer losses for several years and then try to recoup them in an extremely competitive environment (read: low margins). I think the real mistake there was when Hurd bought Palm in the first place, and I see no evidence that anyone in HP's upper management thinks otherwise.

mrich 15y ago

Wow. What is going on there? At first I thought Apotheker was hired to complete some "unpopular" tasks, and then a new CEO could start over. But it seems like the board was completely asleep while Apotheker made his decisions. I am looking forward to some massive lawsuits brought against these people. Apotheker probably was the most clever guy in this, and knew that he could make a quick 20 million even though he would be fired. Would be interested in insights from HP employees.

sliverstorm 15y ago
I suddenly find myself wondering if someone wanted the stock price to crater, to make a takeover or mega-buy-in cheaper.
- pedalpete 15y ago
  Interesting theory, and with the history of this HP board, this is actually a very minor possibility. http://en.wikipedia.org/wiki/Hewlett-Packard_spying_scandal http://en.wikipedia.org/wiki/Hewlett-Packard_spying_scandal You've made me wonder if the quality of the algorithms used for trading make it near impossible for the SEC to track these sort of criminal activities.
thefreehunter 15y ago
Lawsuits for what?
- bluedanieru 15y ago
  For not performing due diligence when discussing the company's strategy with the new CEO, leading to about two years of fucking around (after a decade of fucking around) and cratering the company's value to the shareholders.
  - kb101 15y ago
    Unfortunately, the board is close to dysfunctional. http://www.reuters.com/article/2011/09/22/us-hp-board-insight-idUSTRE78L4M020110922 http://www.reuters.com/article/2011/09/22/us-hp-board-insigh... http://www.nytimes.com/2011/09/22/business/voting-to-hire-a-chief-without-meeting-him.html http://www.nytimes.com/2011/09/22/business/voting-to-hire-a-...

w33ble 15y ago

First good decision they've made in a while. Too bad they are unlikely to reverse the WebOS decision. I have to wonder how much this had to do with not finding anyone to buy it at a price they were willing to take.

codezero 15y ago

With all the bad moves HP has made recently, this is a good one. Although my testimony is likely not worth much, I feel it's important to convey why I think HP's PC division is worth keeping around. My boss' HP desktop died, he brought it to me to see if I could fix it quickly, and I went through the steps on HP's website to "troubleshoot" it. I was pretty sure the power supply was dead, and I sent an email to support explaining all the steps I went through to determine that. There was an option on the page to list experience level, and I put it at the max. The first response I got was that they would send a shipping box for it and that they would replace the PSU. They 1) trusted their customer and 2) didn't back and forth, wasting their time and mine. I got the box within a few days and returned the system to HP. It was back within 3 days (this is a week total from initial contact to returned system), and the hard drive wasn't even reformatted. This is the kind of service that I am used to from Apple (fix it and forget it), and it renewed my hope in HP, but this was a little over a year ago, so who knows what's going on now.

martey 15y ago
While I have heard good things from a couple of people about HP's business support, my personal experiences with their consumer support division have been wanting. My HP laptop has a locked BIOS that prevents you from replacing the wireless card. I sent them an email message describing the BIOS error message that was returned and asking for more information about what were valid wireless cards for the machine. I received a reply telling me to reinstall my wireless card drivers. Over the next few days, I tried to get someone who understood my issue, but was repeatedly told to reinstall drivers, to reseat the card, and a variety of other solutions that seemed to come from some wireless troubleshooting customer support script. I called, and the person I talked to eventually told me to send the computer in, because "the depot would have a different unlocked BIOS that they could put on". When my computer arrived at the depot, I talked to: - a technician who was sympathetic but very confused about why phone support told me to send my computer to the depot, - two case managers who started out by telling me that they were "non-technical" who I had to explain what a BIOS was, and - a rude senior case manager who yelled at me for wasting everyone's time and told me "if you bought a car with a Sony stereo, you wouldn't expect a Panasonic stereo to work in it". When I told him that he was being rude and I wanted to provide feedback to someone about it, he told me that there was nobody else I could talk to, as his superiors would not want to hear from me. After a day of not hearing anything from the depot about when my computer would be returned, I called a HP executive support number I found on Consumerist or some other forum. The woman I talked to was exceedingly polite, but admitted she was non-technical, but then told me that my issue was "it was because HP wanted it that way" and even though it is in a user-accessible location, trying to install a different wireless card would void my warranty "just like installing Linux." A week or so later, HP released a BIOS update to include more wireless cards on the internal whitelist, in order to support the version of the laptop in the Small Business store (same components, starting price was $300 higher).

trolleycar 15y ago

I don't understand why HP was so public about this decision-making process. Perhaps it wasn't intended, and the original story was leaked? Seems like a good study: see if PSG should be spun off, but I can see no reason to make it public.

aresant 15y ago

Understanding HP's dilemma is as simple as looking at the comps. HP is trading at 6.5x P/E currently. Yet HP's consulting business should be worth more separate (IBM at 14x, Accenture at 18x) And HP's hardware business should be worth more separate (compare Toshiba at 12x, Apple at 15x, even Dell at 9x) As a result I understand why they allowed Apotheker to do what he did. Cut ONCE, bleed heavily and launch two strong, focused companies that aren't burdened by the distraction of the other and can unlock maximum shareholder value. BUT wow, do they have a fricking communication challenge. Every press release (even this one) is dry, complicated and nonsensical. The current press release talks about a "data driven decision". Why can't they just explain what they're doing and why? Come on HP.

chugger 15y ago
I agree. HP's hardware business is dragging down its stock price. this is one of the reasons why IBM sold off its PC division to Lenovo. Services and software usually provide a return on invested capital of 30 percent or more, compared to 15-20 percent for hardware. IBM's ROIC is currently at 34.1% compared to HP's ROIC at 16.2%. After IBM sold off its PC division to Lenovo in 2005, IBM's ROIC grew from 17.75% in 2006 to 29.55% in 2010 with a 5 year average of 27.6%.In comparison HP's 5-year average ROIC is only 15.9%. HP wanted to do the same thing IBM did 7 years ago. The big difference was that before selling off its PC division, IBM already had a strong software and services business (generating half of its revenue). they also bought PriceWaterHouseCoopers' consulting arm in 2002. HP's software and services business isn't nearly as strong, even after buying Autonomy so they got clobbered by analyst and the media.
nobody314 15y ago
Splitting off HP's hardware business doesn't suddenly make it worth the same as Apple's That's like claiming if it spun off it's discount coupon business it would be worth the same as groupon.
- pedalpete 15y ago
  He did provide PE ratios for competitors as well, and HP is the largest PC maker. He isn't valuing them the same as Apple, just that the PE ratio should be similar.