Wow, who saw that coming? HP plans to discontinue operations of webOS devices, specifically the TouchPad and webOS phones. Do you hear that sound? That is the sound of people returning their devices at the fear of discontinued support. HP claims they will continue exploring optional venues to use webOS to “optimize the value of webOS software.”
HP is also looking at options of separating the hardware hand of the company from the software and services end. I seem to recall a similar venture by Palm back in the days of PalmOne and Palm Source. We saw that did not work out so well either. The TouchPad may not have garnered the success HP had intended it to have so far. Could it be that HP just wants to separate their name from a product that could possibly fail in overall adoption? That could be the case in this end or suspension of webOS on tablets and smartphones.
We can now see that the change that HP made by moving John Rubinstein was just the beginning of these announcements. According to reports from This is my Next, HP’s Global Business Unit Vice President Stephen DeWitt “made it clear that the current business model of webOS wasn’t working due to lackluster hardware, and that HP needed to stop trying to force non-competitive products into the market.”
HP appears interested in using webOS as merely an platform they can license and sell to other manufacturers. This way they could possibly limit their financial risk and also create a more diverse portfolio of devices running their OS. We see this success currently in Android, albeit the issue of fragmentation.
[spoiler]August 18, 2011 03:02 PM Eastern Daylight Time
HP Confirms Discussions with Autonomy Corporation plc Regarding Possible Business Combination; Makes Other Announcements
PALO ALTO, Calif.–(BUSINESS WIRE)–HP (NYSE: HPQ) today commented on the recent announcement by Autonomy Corporation plc (LSE: AU.L). HP confirms that it is in discussions with Autonomy regarding a possible offer for the company.
HP also reported that it plans to announce that its board of directors has authorized the exploration of strategic alternatives for its Personal Systems Group (PSG). HP will consider a broad range of options that may include, among others, a full or partial separation of PSG from HP through a spin-off or other transaction.
In addition, HP reported that it plans to announce that it will discontinue operations for webOS devices, specifically the TouchPad and webOS phones. HP will continue to explore options to optimize the value of webOS software going forward.
HP today announced preliminary results for the third fiscal quarter 2011, with revenue of $31.2 billion compared with $30.7 billion one year ago.
In the third quarter, preliminary GAAP diluted earnings per share (EPS) was $0.93 and non-GAAP diluted EPS was $1.10, compared with third quarter fiscal 2010 GAAP diluted EPS of $0.75 and non-GAAP diluted EPS of $1.08. Non-GAAP diluted EPS estimates exclude after-tax costs related primarily to the amortization of purchased intangible assets of approximately $0.17 per share and $0.33 per share in the third quarter of fiscal 2011 and fiscal 2010, respectively.
For the fourth fiscal quarter of 2011, HP estimates revenue of approximately $32.1 billion to $32.5 billion, GAAP diluted EPS in the range of $0.44 to $0.55, and non-GAAP diluted EPS in the range of $1.12 to $1.16. Non-GAAP diluted EPS guidance excludes after-tax costs of approximately $0.61 to $0.68 per share, related primarily to restructuring and shutdown costs associated with webOS devices, the amortization and impairment of purchased intangibles, restructuring charges and acquisition-related charges.
HP estimates full-year FY11 revenue will be approximately $127.2 billion to $127.6 billion, down from its previous estimate of $129 billion to $130 billion. FY11 GAAP diluted EPS is expected to be in the range of $3.59 to $3.70, down from its previous estimate of at least $4.27, and FY11 non-GAAP diluted EPS is expected to be in the range of $4.82 to $4.86, down from its previous estimate of at least $5.00. FY11 non-GAAP diluted EPS estimates exclude after-tax costs of approximately $1.16 to 1.23 per share, related primarily to restructuring and shutdown costs associated with webOS devices, the amortization and impairment of purchased intangibles, restructuring charges and acquisition-related charges.
HP will host a conference call with the financial community today at 2 p.m. PT / 5 p.m. ET to discuss these announcements well as HP’s third quarter 2011 financial results. The call is accessible via an audio webcast at www.hp.com/investor/2011q3webcast.
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© 2011 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice. HP shall not be liable for technical or editorial errors or omissions contained herein.[/spoiler]