Hewlett-Packard Unveils Faster Servers With Itanium Chips

Hewlett-Packard Co. (HPQ) showed new computer servers based on Intel Corp. (INTC)’s Itanium chip that deliver faster processing while consuming less power, even as the computer maker moves customers to a different technology platform over time.

Hewlett-Packard introduced new servers that plug into its Superdome 2 and BladeSystem chassis, and an entry-level machine for smaller companies. The hardware -- along with advances in Hewlett-Packard’s HP-UX operating system software -- can process computing transactions as much as three times faster than previous Itanium-based servers while using less energy, the Palo Alto, California-based company said in a statement.

The unveiling comes as Hewlett-Packard, which supplies servers, data storage devices and networking equipment to businesses, has seen revenue from its Business Critical Systems line dry up since business software maker Oracle Corp. (ORCL) said last year it planned to stop developing database software that runs on the Itanium chip. Sales of Business Critical Systems dropped 16 percent to $385 million in the fiscal third quarter that ended in July.

Meg Whitman, Hewlett-Packard’s chief executive officer, is trying to restore growth at the company, whose sales are expected to drop 5 percent this year and next, according to the average estimate of analysts surveyed by Bloomberg. At an Oct. 3 meeting with financial analysts, Whitman said earnings next year would be far lower than analysts had expected.

Hewlett-Packard a year ago revealed a plan that would give customers running Itanium servers -- which include banks and telephone companies -- a path to move their programs to Intel’s more widely used Xeon chips in coming years.

Customers will also be able to move those applications to Microsoft Corp. (MSFT)’s Windows and Red Hat Inc. (RHT)’s Linux operating systems. The advancements in the new servers and software will “cascade” to more Xeon-based servers running Windows and Linux over time, Hewlett-Packard said.

A California court in September ordered Oracle to keep developing software for Itanium after Hewlett-Packard sued Oracle in 2011 for contract violation.

To contact the reporters on this story: Aaron Ricadela in San Francisco at aricadela@bloomberg.net

To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

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