Uncertainty shakes HP profit

Picture of Leo ApothekerHP's quarterly earnings report shows a drop of a stunning 91% compared to this time last year - and striking though the percentage is, nobody can be surprised. In the PC market, not in the PC market, back in the PC market, scrapping tablets and phones, maybe not scrapping tablets and phones after sacking CEO Leo Apotheker (pictured) - did someone say it had only dropped only 91%?
The actual figures show that during the fourth quarter of the year HP, which made $2.5bn in the same period, profited by only $239m for the same period this year.

The problem undoubtedly started when former CEO Leo Apotheker decided to refocus the business entirely on software and services plus high-end systems earlier this year. This meant dropping the WebOS tablets and phones, which the company had bought by buying Palm only 12 months previously.

It made sense. There wasn't and isn't much profit to be had from the "box" market unless you have huge quantities like Dell. HP is substantial but Apotheker's vision was that it should get out of the low profit areas and move into more lucrative markets - the same trick pulled off by IBM a few years back.

So he made the announcement and the WebOS devices were sold off dirt cheap. Unfortunately, no matter what he thought, he didn't have the support of the board - so he was uninstated, PCs were reinstated and the company was expected to make an announcement about WebOS last week - and then didn't.

So no, people haven't been buying a lot of HP kit or services. They don't know which way the company's moving - and there's a nasty suspicion around that HP doesn't know either.
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