And yet, she may make the new company bigger: HP Enterprise will have about $5.5 billion in net cash on its balance sheet, and Whitman has hinted of more M&A deals to come.
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The other, Hewlett Packard Enterprise, or HPE, will sell the computer servers, data storage, networking, software and consulting services that run a modern company.
Will 3D printing save HP Inc.?
HP channel partners have welcomed today’s arrival of the two new HP companies, claiming the strategy is a “much better way of preserving the heritage of HP”. If it is successful it would have a very positive effect on the new company’s early prospects and performance.
Shares in HP Inc were – at time of publication – trading up 13 per cent at $13.83. After that, presumably, the gloves will be off and it will be open season.
Seventy-seven years after Bill Hewlett and Dave Packard began tinkering in a Palo Alto garage, the company that became the foundation of Silicon Valley is breaking up.
Hewlett-Packard Enterprise, on the other hand, will sell computer systems, software, and tech, mostly for the enterprise market. HP’s research and development spending was on the rise, but never recovered from the cuts under former CEO Mark Hurd.
But that is just one possible scenario for one possible future.
HP Inc. and Hewlett Packard Enterprise will start their respective trading on the New York Stock Exchange (NYSE) today, after the split announcement. She has achieved a lot under hard circumstances and is to be applauded for her skill and determination in giving HP another chance by splitting it in twain. When asked about what size they may be, Whitman pointed to companies Hewlett-Packard has bought for around $2 billion to $3 billion, including 3Par, 3Com and Aruba Networks.
Enterprises will focus on selling data center technology and services to businesses. But it also resulted in a huge organization that was pulled in different directions by its enterprise and consumer parts. “Hewlett Packard Enterprise has the vision, financial resources and flexibility to help customers win while generating growth and long-term value for our shareholders”. She’s also taken heat for the company’s plunging stock price during her tenure after engineering HP’s failed merger with Compaq.
The same trends are rocking other long-time tech giants.
HP shares, meanwhile, have declined 24% over the past year, closing at $26.96 on Friday.
HP has tried to run a cloud service to compete with AWS, but it announced that it will shut up shop on its Helion public cloud service and concentrate on hybrid models, enabling customers to build their own clouds that would work with AWS and Azure.
Dion Weisler, the executive vice president of HP’s Printing and Personal Systems business, will be the president and CEO of HP, Inc., according to the press release. Cloud has become the new battleground for tech companies and HP has emerged as a solid contender.
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“Whitman will likely not complete this effort, and at a time when Carly Fiorina is arguing that firms like HP have to get larger [Whitman] is downsizing massively”, Enderle said.
