Hewlett-Packard (HP) may split into two companies. One company will sells HP's computers and printers and the other company will focuses on technology services, including data storage, servers and software.
HP has laid off tens of thousands of employees in recent years due to flagging sales as consumers turn to mobile devices to perform basic computing chores. The shift has curbed demand for HP's desktop and laptop computers, as well as its printers. HP posted revenue of $27.6 billion, up 1 percent at the same time last year. Although only a slight uptick, it marked HP's first year-over-year gain in quarterly revenue since its fiscal third quarter in 2011.
Printers and computers contributed 51 percent of the company's quarterly revenue, with the rest coming from four businesses that offer various technology services, including consulting, software and financial programs.
Recent years HP has been struggled to adopt the recent market. HP's market value of $66 billion is dwarfed by Apple Inc's $596 billion and Microsoft Corp's $380 billion.
EMC Corp. (EMC), a maker of storage computers, is exploring strategic options that could include a full or partial sale, or a spinoff of VMware Inc. (VMW), and has also held merger talks with Hewlett-Packard, people familiar with the matter have said. The idea of Hewlett-Packard spinning off or separating the printers and PCs businesses came up in those discussions, a person familiar with the matter said. The idea would have been to have a combined company focusing on areas such as storage, servers, software and security,
Hewlett-Packard’s printing and personal systems group reported $55.9 billion in revenue in the company’s latest fiscal year, compared with $55.6 billion for the technology solutions group, which provides systems support and consulting for other companies. The PC and printing had a combined operating profit of $4.84 billion, while the corporate services division had operating income of $5.85 billion.