HP Launches Multi-Year Restructuring to Fuel Innovation and

HP Launches Multi-Year Restructuring to Fuel Innovation and Enable
PALO ALTO, CA -- (Marketwire) -- 05/23/12 --   HP (NYSE: HPQ) today
outlined plans for a multi-year productivity initiative designed to
simplify business processes, advance innovation and deliver better
results for customers, employees and shareholders.  
The restructuring is expected to generate annualized savings in the
range of $3.0 to $3.5 billion exiting fiscal year 2014, of which the
majority will be reinvested back into the company. Enabling
investments in people, processes and technology will allow HP to
accomplish the restructuring effort and to generate the savings.
These moves are expected to yield significant improvements in
efficiency and customer service during the next several years. HP
expects to use the savings to boost investment in innovation around
its three areas of strategic focus: cloud, big data and security, as
well as in other segments that offer attractive growth potential.  
As part of the restructuring, HP expects approximately 27,000
employees to exit the company, or 8.0% of its workforce as of Oct.
31, 2011, by the end of fiscal year 2014. The company is offering an
early retirement program, so the total number of employees affected
will be impacted by the number of employees that participate in the
early retirement plan. Workforce reduction plans will vary by
country, based on local legal requirements and consultation with
works councils and employee representatives, as appropriate.  
In addition to these restructuring actions, HP expects to achieve
additional savings from non-headcount cost reductions, including
supply chain optimization, SKU and platform rationalization,
go-to-market strategy simplification and business process
"These initiatives build upon our recent organizational realignment,
and will further streamline our operations, improve our processes,
and remove complexity from our business," said Meg Whitman, HP
president and chief executive officer. "While some of these actions
are difficult because they involve the loss of jobs, they are
necessary to improve execution and to fund the long term health of
the company. We are setting HP on a path to extend our global
leadership and deliver the greatest value to customers and
HP expects to reinvest savings in each of its business segments to
strengthen their ability to stay ahead of customer expectations and
capitalize on growing market trends.  

--  HP will invest in research and development to drive innovation and
    differentiation across its core printing and personal systems
    businesses, as well as emerging areas. It will also invest in
    marketing, sales productivity and tools that simplify the customer
    experience and make it easier to do business with HP.
--  Services will invest in accelerating service capabilities in the high
    client value areas of cloud, security and information analytics by
    enhancing HP intellectual property. Services will also strengthen its
    industry orientation and continue to differentiate its service
    offerings through quality and innovation delivered to clients.
    Combined, these activities are expected to shift the portfolio to a
    more profitable mix of higher-growth services. Additional work in lean
    process methodologies is expected to better serve clients and increase
    overall efficiencies.
--  Software will invest to speed development in the areas of security,
    big data and the management of application lifecycle and
    infrastructure solutions, both on premise and in the cloud. It will
    also further leverage the capabilities of Autonomy and Vertica across
    the entire HP portfolio.
--  Enterprise Servers, Storage and Networking will invest to accelerate
    its research and development activities to extend its leading
    portfolio of servers, storage and networking. Together these assets
    create a Converged Infrastructure which is the foundation for top
    client initiatives such as cloud, virtualization, big data analytics,
    legacy modernization and social media.

As a result of this restructuring, HP expects to record a pre-tax
charge of approximately $1.7 billion in fiscal 2012 that will be
included in its GAAP financial results for that period. Through
fiscal 2014, HP expects to record additional pre-tax charges
approximating $1.8 billion that will be included in its GAAP
financial results for the appropriate periods.  
About HP
 HP creates new possibilities for technology to have a
meaningful impact on people, businesses, governments and society. The
world's largest technology company, HP brings together a portfolio
that spans printing, personal computing, software, services and IT
infrastructure to solve customer problems. More information about HP
is available at http://www.hp.com. 
This news release contains forward-looking statements that involve
risks, uncertainties and assumptions. If such risks or uncertainties
materialize or such assumptions prove incorrect, the results of HP
and its consolidated subsidiaries could differ materially from those
expressed or implied by such forward-looking statements and
assumptions. All statements other than statements of historical fact
are statements that could be deemed forward-looking statements,
including but not limited to any forecasts or projections of the
extent or timing of cost savings, charges, use of cost savings,
revenue or profitability improvements, or other financial items;
statements of the plans, strategies and objectives of management for
future operations, including the timing and execution of cost
reduction programs, restructuring plans, retirement programs and the
number of employees impacted by such plans and programs; any
statements concerning HP's expected competitive position or
performance; any statements concerning expected development,
performance or market share relating to products and services; any
statements regarding anticipated operational and financial results;
any statements of expectation or belief; and any statements of
assumptions underlying any of the foregoing. Risks, uncertainties and
assumptions include the timing and execution of cost reduction
programs, restructuring plans and retirement programs; employee
management issues and negotiations with works councils and employee
representatives; estimates and assumptions related to the cost of
exiting employees and pension and other post-retirement costs; the
competitive pressures faced by HP's businesses; the development and
transition of new products and services (and the enhancement of
existing products and services) to meet customer needs and respond to
emerging technological trends; and other risks that are described in
HP's Quarterly Report on Form 10-Q for the fiscal quarter ended
January 31, 2012 and HP's other filings with the Securities and
Exchange Commission, including HP's Annual Report on Form 10-K for
the fiscal year ended October 31, 2011. HP assumes no obligation and
does not intend to update these forward-looking statements. 
Copyright 2012 Hewlett-Packard Development Company, L.P. The
information contained herein is subject to change without notice. The
only warranties for HP products and services are set forth in the
express warranty statements accompanying such products and services.
Nothing herein should be construed as constituting an additional
warranty. HP shall not be liable for technical or editorial errors or
omissions contained herein. 
Editorial contacts 
Michael Thacker
+1 650 857 2254
HP Investor Relations
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