Hewlett-Packard Co (HP) said it is evaluating the disposition of businesses that do not meet goals more than a year after CEO Meg Whitman said she does not plan to spin off the personal computer division.
“We also continue to evaluate the potential disposition of assets and businesses that may no longer help us meet our objectives,” Hewlett-Packard said in a Dec. 27 10-K filing with the US Securities and Exchange Commission.
That language was not included in the document a year earlier.
CEO since September 2011, Whitman is working to turn around Palo Alto, California-based HP after five straight quarters of declining sales and years of botched deals, management tumult and strategic missteps.
An US$8.8 billion writedown of the acquired software company Autonomy Corp in November renewed calls on Wall Street for HP to realize shareholder value by shedding certain businesses, such as PCs and printers.
RISK FACTORS
HP, the world’s largest maker of PCs and printers, discussed the evaluation in the “Risk Factors” section of its regulatory filing, saying that any disposal would have possible drawbacks.
“When we decide to sell assets or a business, we may encounter difficulty in finding buyers or alternative exit strategies on acceptable terms in a timely manner, which could delay the achievement of our strategic objectives,” HP said.
The company also said in the filing that the US Department of Justice had opened an investigation relating to Autonomy. HP accused the software company of misrepresenting its performance before being bought in 2011.
DISCLOSURE
The disclosure that HP is evaluating disposing of assets or businesses came 14 months after Whitman said she would keep the company’s PC business in house. Her predecessor, Leo Apotheker, had explored a spinoff of the unit, which had US$35.7 billion in sales in the last fiscal year, or 29 percent of the total.
Whitman instead unified the PC and printer groups’ management under executive vice president Todd Bradley last year. The printer unit accounted for US$24.5 billion in fiscal 2012 revenue, or 20 percent of total sales.
Michael Thacker, a spokesman for HP, declined to comment beyond the filing.
The company’s filing said it may “dispose of a business at a price or on terms that are less desirable than we had anticipated.”
In addition, “the impact of the divestiture on our revenue growth may be larger than projected,” the filing said.
Shares of HP gained 4.2 percent to US$14.25 at Monday’s close in New York. The shares declined 45 percent last year.
WASHINGTON’S INCENTIVES: The CHIPS Act set aside US$39 billion in direct grants to persuade the world’s top semiconductor companies to make chips on US soil The US plans to award more than US$6 billion to Samsung Electronics Co, helping the chipmaker expand beyond a project in Texas it has already announced, people familiar with the matter said. The money from the 2022 CHIPS and Science Act would be one of several major awards that the US Department of Commerce is expected to announce in the coming weeks, including a grant of more than US$5 billion to Samsung’s rival, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), people familiar with the plans said. The people spoke on condition of anonymity in advance of the official announcements. The federal funding for
HIGH DEMAND: The firm has strong capabilities of providing key components including liquid cooling technology needed for AI servers, chairman Young Liu said Hon Hai Precision Industry Co (鴻海精密) yesterday revised its revenue outlook for this year to “significant” growth from a “neutral” view forecast five months ago, due to strong demand for artificial intelligence (AI) servers from cloud service providers. Hon Hai, a major assembler of iPhones that is also known as Foxconn, expects AI server revenues to soar more than 40 percent annually this year, chairman Young Liu (劉揚偉) told investors. The robust growth would uplift revenue contribution from AI servers to 40 percent of the company’s overall server revenue this year, from 30 percent last year, Liu said. In the three-year period
LONG HAUL: Largan Energy Materials’ TNO-based lithium-ion batteries are expected to charge in five minutes and last about 20 years, far surpassing conventional technology Largan Precision Co (大立光) has formed a joint venture with the Industrial Technology Research Institute (ITRI, 工研院) to produce fast-charging, long-life lithium-ion batteries for electric vehicles, mobile electronics and electric storage units, the camera lens supplier for Apple Inc’s iPhones said yesterday. Largan Energy Materials Co (萬溢能源材料), established in January, is developing high-energy, fast-charging, long-life lithium-ion batteries using titanium niobium oxide (TNO) anodes, it said. TNO-based batteries can be fully charged in five minutes and have a lifespan of 20 years, a major advantage over the two to four hours of charging time needed for conventional graphite-anode-based batteries, Largan said in a
Taiwan is one of the first countries to benefit from the artificial intelligence (AI) boom, but because that is largely down to a single company it also represents a risk, former Google Taiwan managing director Chien Lee-feng (簡立峰) said at an AI forum in Taipei yesterday. Speaking at the forum on how generative AI can generate possibilities for all walks of life, Chien said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) — currently among the world’s 10 most-valuable companies due to continued optimism about AI — ensures Taiwan is one of the economies to benefit most from AI. “This is because AI is