HP CEO Says Split Effective From November 1

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By Reuters | Updated: 3 June 2015 13:18 IST
Hewlett-Packard Chief Executive Meg Whitman said the separation of HP Inc and Hewlett-Packard Enterprise would be effective on November 1.

Whitman made the announcement during the company's technology event, HP Discover 2015, in Las Vegas on Tuesday.

The world's No. 2 personal computer maker said in October it would split into two listed companies, separating its computer and printer businesses from its faster-growing corporate hardware and services operations.

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In late-May, HP forecast separation-related costs below the expectation of several analysts and reported a better-than-expected quarterly profit.

The 75-year-old company said it expects $400 million-$450 million of costs from the planned separation of its computer and printer businesses from its faster-growing corporate hardware and service operations.

On a conference call, the company said it sees potentially $2 billion in restructuring costs in its Enterprise Services group over three years. The company added it may reduce costs at the two companies by about $1 billion during the same period.

"I thought it could be a little higher than that," FBN Securities analyst Shebly Seyrafi said. There was some excitement about the costs being less than expected, he said.

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The forecast soothed investor concerns about costs for the breakup in the first year, Cross Research analyst Shannon Cross said.

Ongoing cost reductions and HP's focus on higher-margin sales were driving profit, Cross said. Total costs and expenses fell 5.7 percent to $24 billion in the second quarter ended April 30.

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"I think the Street was expecting higher expenses," Seyrafi said.

Edited by NDTV staff from original story by Reuters

 

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Further reading: HP, Hewlett Packard, Internet, Laptops, PC
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