HP halts WebOS business, spins off laptop unit

HP said nowadays it'll discontinue its WebOS operations because the company cut its outlook for succeeding 2 quarters.the corporate will acquire Autonomy, an enterprise info retrieval outfit.

The company said it'll discontinue operations for WebOS devices, specifically the TouchPad and WebOS phones. In April 2010, HP talked regarding doubling down on Palm and also the WebOS. which WebOS unit can price HP some dough to discontinue. HP will spin off its laptop unit.

HP said that it'll take a success to fiscal 2011 earnings of $1.16 a share to $1.23 a share because it restructures and shuts down WebOS devices and connected operations. there have been signs that TouchPad sales were bleak, however an entire shutdown of WebOS operations was sudden.

HP's statement held a bevy of things for patrons and shareholders to ponder. First, HP's customers--and anyone who bought a TouchPad--wonder what the potential sale or discontinuation of the unit can mean. Shareholders got to take into account the spinoff of the laptop unit further as a lower-than-expected outlook for the remainder of the year. On a conference decision with analysts, HP CEO Leo Apotheker said:

Transformation will involve troublesome selections, however we have a tendency to take these steps to higher position forthe long run. These challenges and also the transformation we have a tendency to are enterprise can take many quartersto completely resolve. i do not take this action gently. i do know our investors loathe being during this position and neither do I. I feel that as CEO i feel in transparency concerning what we have a tendency to face and be clear below the scale of things we have a tendency to do currently concerning it. To conclude, i am taking possession for these selections and investments with a spotlight on driving actions that deliver price for shareholders as we have a tendency to form the new HP.

HP said that its third-quarter revenue are $31.2 billion with earnings of ninety three cents a share. Non-GAAP earnings are$1.10 a share. Wall Street was yearning for earnings of $1.09 a share on revenue of $31.17 billion.
Overall, the third-quarter results were the smallest amount of HP's worries. the corporate said its fourth-quarter revenue are$32.1 billion to $32.5 billion. Non-GAAP earnings are $1.12 a share to $1.16 a share. Wall Street was yearning for $1.31 a share on revenue of $33.99 billion.

The steerage indicates that HP is seeing material weakness and having a harder time navigating economic uncertainty relative to rivals like Dell. HP conjointly confirmed that it's in talks to shop for software maker Autonomy, that relies within the U.K.

Remaking HP
HP's move to shed the laptop business likewise as discontinue the TouchPad has its risks. For starters, HP can take aname hit for launching a TouchPad and then killing it.

In a statement, HP said it'll ask for "strategic alternatives" for its Personal Systems cluster (PSG), as well as a full or partial spinoff.