Hewlett-Packard: Difference between revisions

Hewlett-Packard Company
	Final logo used from 2012 to 2015, retained by HP Inc.
	HP's headquarters in Palo Alto, California, 2013
Company type	Public
Traded as	NYSE: HPQ (2002–2015)
Industry	Computer hardware; Computer software; IT services; IT consulting;
Founded	July 2, 1939; 85 years ago
Founders	Bill Hewlett; David Packard;
Defunct	November 1, 2015; 9 years ago
Fate	Split into HP Inc. and Hewlett Packard Enterprise
Successors	HP Inc. (legal successor); Hewlett Packard Enterprise; DXC Technology; Micro Focus; Agilent Technologies;
Headquarters	Palo Alto, California; 37°24′49″N 122°08′42″W / 37.4136°N 122.1451°W, U.S.
Area served	Worldwide
Products	List of Hewlett-Packard products
Revenue	2,000,000,000 United States dollar (2015)
Subsidiaries	List of subsidiaries

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The Hewlett-Packard Company, commonly shortened to Hewlett-Packard (/ˈhjuːlɪt ˈpækərd/ HEW-lit PAK-ərd) or HP, was an American multinational information technology company headquartered in Palo Alto, California. HP developed and provided a wide variety of hardware components, as well as software and related services to consumers, small and medium-sized businesses (SMBs), and fairly large companies, including customers in government, health, and education sectors. The company was founded in a one-car garage in Palo Alto by Bill Hewlett and David Packard in 1939, and initially produced a line of electronic test and measurement equipment. The HP Garage at 367 Addison Avenue is now designated an official California Historical Landmark, and is marked with a plaque calling it the "Birthplace of 'Silicon Valley'".

The company won its first big contract in 1938 to provide the HP 200B, a variation of its first product, the HP 200A low-distortion frequency oscillator^[1] for Walt Disney's production of the 1940 animated film Fantasia, which allowed Hewlett and Packard to formally establish the Hewlett-Packard Company on July 2, 1939.^[2] The company grew into a multinational corporation widely respected for its products. HP was the world's leading PC manufacturer from 2007 until the second quarter of 2013, when Lenovo moved ahead of HP.^[3]^[4]^[5] HP specialized in developing and manufacturing computing, data storage, and networking hardware; designing software; and delivering services. Major product lines included personal computing devices, enterprise and industry standard servers, related storage devices, networking products, software, and a range of printers and other imaging products. The company directly marketed its products to households; small- to medium-sized businesses and enterprises, as well as via online distribution; consumer-electronics and office-supply retailers; software partners; and major technology vendors. It also offered services and a consulting business for its products and partner products.

In 1999, HP spun off its electronic and bio-analytical test and measurement instruments business into Agilent Technologies; HP retained focus on its later products, including computers and printers. It merged with Compaq in 2002, and acquired Electronic Data Systems in 2008, which led to combined revenues of $118.4 billion that year and a Fortune 500 ranking of 9 in 2009. In November 2009, HP announced its acquisition of 3Com,^[6] and closed the deal on April 12, 2010.^[7] On April 28, 2010, HP announced its buyout of Palm, Inc. for $1.2 billion.^[8] On September 2, 2010, HP won its bidding war for 3PAR with a $33 a share offer ($2.07 billion), which Dell declined to match.^[9]

On November 1, 2015, Hewlett-Packard was split into two separate companies. Its enterprise products and services business were spun-off to form Hewlett Packard Enterprise, while its personal computer and printer businesses became HP Inc.^[10]

History

Logo used from 1954 to 1964

Bill Hewlett and David Packard graduated with degrees in electrical engineering from Stanford University in 1935. The company started in a garage in Palo Alto during a fellowship they had with past professor Frederick Terman at Stanford during the Great Depression, whom they considered a mentor in forming the company.^[11] In 1938, Packard and Hewlett began part-time work in a rented garage with an initial capital investment of US$538 (equivalent to $11,645 in 2023). In 1939, Hewlett and Packard decided to formalize their partnership. They tossed a coin to decide whether the company they founded would be called Hewlett-Packard (HP) or Packard-Hewlett.^[12]

Hewlett and Packard's first financially successful product was a precision audio oscillator known as the HP 200A, which used a small incandescent light bulb (known as a "pilot light") as a temperature dependent resistor in a critical portion of the circuit, and a negative feedback loop to stabilize the amplitude of the output sinusoidal waveform. This allowed the HP 200A to be sold for $89.40 when competitors were selling less stable oscillators for over $200. The 200 series of generators continued production until at least 1972 as the 200AB, still tube-based but improved in design through the years.^[13]

One of the company's earliest customers was Bud Hawkins, chief sound engineer for Walt Disney Studios, who bought eight HP 200B audio oscillators (at $71.50 each) to be used in the animated film Fantasia. HP's profit at the end of 1939, its first full year of business, was $1,563 (equivalent to $34,236 in 2023) on revenues of $5,369.^[14]

In 1942, they built their first building at 395 Page Mill Road and were awarded the Army-Navy "E" Award in 1943. HP employed 200 people and produced the audio oscillator, a wave analyzer, distortion analyzers, an audio-signal generator, and the Model 400A vacuum-tube voltmeter during the war.^[14]^{: 54–60, 195}

Hewlett and Packard worked on counter-radar technology and artillery shell proximity fuzes during World War II; the work exempted Packard from the draft,^[15] but Hewlett had to serve as an officer in the Army Signal Corps after being called to active duty.

HP was incorporated on August 18, 1947, with Packard as president. Sales reached $5.5 million in 1951 with 215 employees. The company went public on November 6, 1957.^[14]^{: 35, 40, 64, 70, 196} In 1959, a manufacturing plant was established in Böblingen and a marketing organization in Geneva.^[14]^: 196 Packard handed the presidency over to Hewlett when he became chairman in 1964, but remained CEO of the company.

1960s

Logo used from 1964^[16] to 1981

The HP200A, a precision audio oscillator, was the company's very first financially successful product.

HP is recognized as the symbolic founder of Silicon Valley, though it did not actively investigate semiconductor devices until a few years after the "traitorous eight" abandoned William Shockley to create Fairchild Semiconductor in 1957. Hewlett-Packard's HP Associates division, established around 1960, developed semiconductor devices primarily for internal use. Instruments and calculators were some of their products using semiconductor devices.

During the 1960s, HP partnered with Sony and Yokogawa Electric in Japan to develop several high-quality products. The products were not a huge success, as there were high costs involved in building HP-looking products in Japan. In 1963, HP and Yokogawa formed the joint venture Yokogawa-Hewlett-Packard to market HP products in Japan.^[17] HP bought Yokogawa Electric's share of Hewlett-Packard Japan in 1999.^[18]

HP spun off the small company Dynac to specialize in digital equipment. The name was picked so that the HP logo could be turned upside down to be a reflected image of the logo of the new company. Dynac was eventually renamed Dymec and folded back into HP in 1959.^[19] HP experimented with using Digital Equipment Corporation (DEC) minicomputers with its instruments, but entered the computer market in 1966 with the HP 2100 / HP 1000 series of minicomputers after it decided that it would be easier to build another small design team than deal with DEC. The minicomputers had a simple accumulator-based design with two accumulator registers and, in the HP 1000 models, two index registers. The series was produced for 20 years in spite of several attempts to replace it, and was a forerunner of the HP 9800 and HP 250 series of desktop and business computers.

At the end of 1968, Packard handed over the duties of CEO to Hewlett to become United States Deputy Secretary of Defense in the incoming Nixon administration. He resumed the chairmanship in 1972 and served until 1993, but Hewlett remained the CEO.

1970s

The HP 3000 was an advanced stack-based design for a business computing server, later redesigned with RISC technology. The HP 2640 series of smart and intelligent terminals introduced forms-based interfaces to ASCII terminals, and also introduced screen labeled function keys, now commonly used on gas pumps and bank ATMs. The HP 2640 series included one of the first bit mapped graphics displays that, when combined with the HP 2100 21MX F-Series microcoded Scientific Instruction Set,^[20] enabled the first commercial WYSIWYG presentation program, BRUNO, that later became the program HP-Draw on the HP 3000. Although scoffed at in the formative days of computing, HP surpassed IBM as the world's largest technology vendor in terms of sales.^[21]

HP was identified by Wired magazine as the producer of the world's first device to be called a personal computer: the Hewlett-Packard 9100A, introduced in 1968.^[22] HP called it a desktop calculator because, as Hewlett said: "If we had called it a computer, it would have been rejected by our customers' computer gurus because it didn't look like an IBM. We therefore decided to call it a calculator, and all such nonsense disappeared." An engineering triumph at the time, the logic circuit was produced without any integrated circuits, and the CPU assembly was entirely executed in discrete components. With CRT display, magnetic-card storage, and printer, the price was around $5,000. The machine's keyboard was a cross between the keyboard of a scientific calculator and the keyboard of an adding machine. There was no alphabetic keyboard.

Apple co-founder Steve Wozniak originally designed the Apple I computer while working at HP and offered it to them under their right of first refusal to his work. They did not take it up as the company wanted to stay in scientific, business, and industrial markets. Wozniak said that HP "turned him down five times", but that his loyalty to HP made him hesitant to start Apple with Steve Jobs.^[23]

The company earned global respect for a variety of products. They introduced the world's first handheld scientific electronic calculator in 1972 (the HP-35), the first handheld programmable in 1974 (the HP-65), the first alphanumeric, programmable, expandable in 1979 (the HP-41C), and the first symbolic and graphing calculator, the HP-28C.

Like their scientific and business calculators, HP oscilloscopes, logic analyzers, and other measurement instruments had a reputation for sturdiness and usability. HP introduced the Hewlett-Packard Interface Bus (HPIB) computer peripheral interface (later cloned by National Instruments as GPIB and standardized by the IEEE as IEEE-488) on their relay actuator products in 1973. HPIB was later integrated into most high end test & measurement equipment it produced from 1980 onward.

As early as 1977, HP began production of the HP856x spectrum analyzers to complement its RF power meters and sensors capable of measuring signals in excess of 20 GHz. HP also produced configurable chassis based sweep generators capable of generating signals to 20 GHz. Other T&M products of the time included lab grade multimeters, microwave frequency counters, RF amplifiers, high accuracy microwave detectors, lab grade power supplies and more. These products were succeeded by modernized versions as well as the introduction of the scalar and vector network analyzer product lines prior to the business being spun off into Agilent Technologies.

The HP 9800 series of technical desktop computers started in 1971 with the 9810A. The HP Series 80 started in 1979 with the 85.^[24] Some of these machines used a version of the BASIC programming language, which was available immediately after they were switched on, and used a proprietary magnetic tape for storage. HP computers were similar in capabilities to the much later IBM Personal Computer, though the limitations of available technology forced prices to be high.^{[citation needed]}

In 1978, Hewlett stepped down as CEO and was succeeded by John A. Young.

1980s

Logo used from 1979 to 2008

HP expanded into South Africa in the 1980s. Activists supporting divestment from South Africa accused HP of "automating apartheid".^[25]

Sales reached $6.5 billion in 1985 with 85,000 employees.^[14]^: 198

In 1984, HP introduced both inkjet and laser printers for the desktop. Along with its scanner product line, the printers have later been developed into successful multifunction products, the most significant being single-unit printer/scanner/copier/fax machines. The print mechanisms in HP's LaserJet line of laser printers depend almost entirely on Canon Inc.'s components (print engines), which in turn use technology developed by Xerox. HP developed the hardware, firmware, and software to convert data into dots for printing.^[26]

On March 3, 1986, HP registered the HP.com domain name, making it the ninth Internet .com domain to be registered.^[27]

In 1987, the Palo Alto garage where Hewlett and Packard started their business was designated as a California Historical Landmark.

1990s

Logo used from 1999^[28] to 2012

In the 1990s, HP expanded their computer product line, which initially had been targeted at university, research, and business users, to reach consumers. HP also grew through acquisitions: it bought Apollo Computer in 1989 and Convex Computer in 1995.

In 1992, Young was succeeded by Lewis E. Platt, and in 1993 and Hewlett and Packard stepped down from the board with Platt succeeding Packard as chairman.

In 1993, HP acquired Advanced Design System from Pathwave. The ADS suite of RF simulation tools was spun off into Agilent in 1999 along with related T&M business units, all of which were carried forward into the spinoff of Agilent into Keysight.

Later in the decade, HP opened hpshopping.com as an independent subsidiary to sell online, direct to consumers; in 2005, the store was renamed "HP Home & Home Office Store".

From 1995 to 1999, Hewlett-Packard were sponsors of the English football team Tottenham Hotspur.

In 1999, all of the businesses not related to computers, storage, and imaging were spun off from HP to form Agilent Technologies. Agilent's spin-off was the largest initial public offering in the history of Silicon Valley,^[29] and it created an $8 billion company with about 30,000 employees, manufacturing scientific instruments, semiconductors, optical networking devices, and electronic test equipment for telecom and wireless, research and development, and production.

In July 1999, HP appointed Carly Fiorina as the first female CEO of a Fortune-20 company in the Dow Jones Industrial Average.^[30] Fiorina received a larger signing offer than any of her predecessors.^[31] The same year, Fiorina articulated a set of "rules of the garage", an attempt to capture the spirit of the company's founders.^[32]

Sales to Iran despite sanctions

In 1997, HP started selling its products in Iran through a European subsidiary and a Dubai-based Middle Eastern distributor, despite U.S. export sanctions prohibiting such deals imposed by Bill Clinton's 1995 executive orders.^[33]^[34]^[35] The story was initially reported by The Boston Globe,^[36] and it triggered an inquiry by the U.S. Securities and Exchange Commission (SEC). HP responded that products worth US$120 million were sold in fiscal year 2008^[37] for distribution via Redington Gulf, a company based in the Netherlands, and that as these sales took place through a foreign subsidiary, HP had not violated sanctions.^[33]

HP named Redington Gulf "Wholesaler of the Year" in 2003, which in turn published a press release stating that "[t]he seeds of the Redington-Hewlett-Packard relationship were sowed six years ago for one market — Iran."^[33] At the time, Redington Gulf had only three employees whose sole purpose was to sell HP products to the Iran market.^[36] According to former officials who worked on sanctions, HP used a loophole by routing their sales through a foreign subsidiary.^[33] HP ended its relationship with Redington Gulf after the SEC inquiry.^[33]

2000–2005

On September 3, 2001, HP announced that an agreement had been reached with Compaq to merge the two companies.^[38] On May 3, 2002, after passing a shareholder vote, HP officially announced the merger with Compaq.^[39] Prior to this, plans had been in place to consolidate the companies' product teams and product lines. The newly-merged company would officially launch five days after the announcement on May 7, 2002.^[40]

As Compaq acquired Tandem Computers in 1997 and Digital Equipment Corporation (DEC) in 1998, HP inherited both acquired companies' product lines, and offered support for the Tandem NonStop family (now owned by Hewlett Packard Enterprise) and DEC products PDP-11, VAX and Alpha. Both the DEC PDP-11 and VAX were discontinued years before the merger, and HP supported DEC Alpha until April 2007.^{[clarification needed]}

The merger was preceded by a proxy fight in 2001 with numerous large HP shareholders as well as the sons of the co-founders, with Bill Hewlett's son Walter objecting to the merger, only approving it reluctantly.^[41] HP's pre-merger ticker symbol was "HWP". After the merger with Compaq, the new ticker symbol became "HPQ", which was announced on May 6, 2002.^[42] "HPQ" is a combination of the two previous symbols, "HWP" and "CPQ", to show the significance of the alliance and also key letters from the two companies Hewlett-Packard and Compaq (the latter company being famous for incorporating the letter "Q" on its logo for all of their products). HP then went on to become a major producer in desktop computers, laptops, and servers for many different markets.

Mscape was a mobile media gaming platform that could be used to create location-based games originating in 2002.

HP released the HP Pavilion dv1000 series of laptops in 2004, which included the HP Pavilion dv1658 and dv1040 models. Other laptop models available around this time were the dv4000, dv5000, and the dv8000 series.

In January 2005, following years of underperformance, which included HP's Compaq merger that fell short^[43] and disappointing earning reports,^[44] the board asked Fiorina to resign as chair and chief executive officer of the company, and she did on February 9, 2005.^[45] After her departure, HP's stock jumped 6.9 percent.^[46] Robert Wayman, chief financial officer of HP, served as interim CEO while the board undertook a formal search for a replacement.^[47]

Mark Hurd of NCR Corporation was hired to take over as CEO and president, effective April 1, 2005. Hurd was the board's top choice given the revival of NCR that took place under his leadership.^[43]

2006–2009

A sign marking the entrance to the HP corporate headquarters in Palo Alto, California, 2006

In 2006, HP unveiled several new products including desktops, enhanced notebooks, a workstation, and software to manage them—OpenView Client Configuration Manager 2.0.^[48] In that same year, HP's share price skyrocketed due to consistent results in the last couple quarters of the year with Hurd's plan to cut back HP's workforce and lower costs.^[49]

HP began its marketing campaign called "The Computer is Personal Again" in May 2006, aimed at bringing back the personal computer as a personal product. The campaign utilized viral marketing and sophisticated visuals, as well as its own website. Some of the ads featured Pharrell,^[50] Petra Nemcova, Mark Burnett, Mark Cuban, Alicia Keys,^[51] Jay-Z,^[52] Gwen Stefani, and Shaun White.^{[citation needed]} This marketing campaign was also incorporated directly onto HP's product offerings, which included desktops, laptops, and other hardware and software. HP offered three new laptop models in mid-to-late 2006 with the Pavilion dv2000, dv6000, and dv9000 series.

In July 2007, HP signed a definitive agreement to acquire Opsware in a cash tender deal that values the company at $14.25 per share, which combined Opsware software with the Oracle enterprise IT management software.^[53]

In the first few years of Hurd's tenure as CEO, HP's stock price more than doubled. By the end of the 2007 fiscal year, HP reached the $100 billion mark for the first time. The company's annual revenue reached $104 billion, allowing HP to overtake competitor IBM.^[54]

On May 13, 2008, HP and Electronic Data Systems (EDS) announced^[55] that they had signed a definitive agreement under which HP would purchase EDS. On June 30, HP announced^[56] that the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 had expired. "The transaction still requires EDS stockholder approval and regulatory clearance from the European Commission and other non-U.S. jurisdictions and is subject to the satisfaction or waiver of the other closing conditions specified in the merger agreement." The agreement was finalized on August 26, 2008, at $13 billion, and it was publicly announced that EDS would be re-branded. The first targeted layoff of 24,600 former EDS workers was announced on September 15, 2008.^[57] (The company's 2008 annual report gave the number as 24,700, to be completed by end of 2009.^[58]) This round was factored into purchase price as a $19.5 billion liability against goodwill. As of September 23, 2009, EDS was known as HP Enterprise Services (now known as DXC Technology).

On November 11, 2009, 3Com and Hewlett-Packard announced that the latter would be acquiring 3Com for $2.7 billion in cash.^[59] The acquisition was one of the biggest in size among a series of takeovers and acquisitions by technology giants to push their way to become one-stop shops. Since the beginning of the financial crisis in 2007, tech giants have constantly felt the pressure to expand beyond their current market niches. Dell purchased Perot Systems recently to invade into the technology consulting business area previously dominated by IBM. Hewlett-Packard's latest move marked its incursion into enterprise networking gear market dominated by Cisco.

2010–2012

On April 28, 2010, Palm, Inc. and HP announced that the latter would buy the former for $1.2 billion in cash and debt.^[60] Adding Palm handsets to the HP product line created some overlap with the iPAQ series of mobile devices, but was thought to significantly improve HP's mobile presence as iPAQ devices had not been selling well. Buying Palm, Inc. gave HP a library of valuable patents and the mobile operating platform, webOS. On July 1, 2010, the acquisition of Palm, Inc. was finalized.^[61] Purchasing its webOS was a big gamble to build HP's own ecosystem.^[62] On July 1, 2011, HP launched its first tablet, HP TouchPad, which brought webOS to tablet devices. On September 2, 2010, HP won the bidding war for 3PAR with a $33 a share offer ($2.07 billion) that Dell declined to match. After HP acquired Palm Inc., it phased out the Compaq brand.

On August 6, 2010, Hurd resigned amid controversy and CFO Cathie Lesjak assumed the role of interim CEO. Hurd had turned HP around and was widely regarded as one of Silicon Valley's star CEOs, and under his leadership, HP became the largest computer company in the world when measured by total revenue.^[63] He was accused of sexual harassment against a colleague, though the allegations were deemed baseless. The investigation led to questions concerning some of his private expenses and the lack of disclosure related to the friendship.^[64]^[65] Some observers have argued that Hurd was innocent, but the board asked for his resignation to avoid negative public relations.^[66]

Public analysis was divided between those who saw it as a commendable tough action by HP in handling expenses irregularities, and those who saw it as an ill-advised, hasty, and expensive reaction in ousting a remarkably capable leader who had turned the business around.^[64]^[65]^[67] At HP, Hurd oversaw a series of acquisitions worth over $20 billion, which allowed the company to expand into services of networking equipment and smartphones.^[68] HP shares dropped by 8.4% in after-hours trading, hitting a 52-week low with $9 billion in market capitalization shaved off.^[69] Larry Ellison publicly attacked HP's board for Hurd's ousting, stating that the HP board had "made the worst personnel decision since the idiots on the Apple board fired Steve Jobs many years ago".^[70]

On September 30, 2010, Léo Apotheker was named HP's new CEO and president.^[71] His appointment sparked a strong reaction from Ellison,^[72] who complained that Apotheker had been in charge of SAP when one of its subsidiaries was systematically stealing software from Oracle. SAP accepted that its subsidiary, which has now closed, illegally accessed Oracle intellectual property.^[73] Following Hurd's departure, HP was seen to be problematic by the market, with margins falling and having failed to redirect and establish itself in major new markets such as cloud and mobile services.^{[citation needed]} Apotheker's strategy was to broadly aim at disposing hardware and moving into the more profitable software services sector. On August 18, 2011, HP announced that it would strategically exit the smartphone and tablet computer business, and focus on higher-margin "strategic priorities of Cloud, solutions and software with an emphasis on enterprise, commercial and government markets".^[74] It also contemplated selling off its personal computer division or spinning it off into a separate company,^[75] and quitting PC development while continuing to sell servers and other equipment to business customers, which was a strategy undertaken by IBM in 2005.^[76]

HP's stock dropped by about a further 40% after the company abruptly announced a number of decisions: to discontinue its webOS device business (mobile phones and tablet computers), the intent to sell its personal computer division (at the time HP was the largest personal computer manufacturer in the world), and to acquire British big data software firm Autonomy for a 79% premium, seen externally as an "absurdly high" price^[77] for a business with known concerns over its accounts.^[78] Media analysts described HP's actions as a "botched strategy shift" and a "chaotic" attempt to rapidly reposition HP and enhance earnings.^[77]^[79]^[80] The Autonomy acquisition was objected to by HP's own CFO.^[81]^[82]^: 3–6

HP lost more than $30 billion in market capitalization during Apotheker's tenure, and on September 22, 2011, the HP Board of Directors fired him as chief executive and replaced him with fellow board member and former eBay chief Meg Whitman,^[83] with Raymond J. Lane as executive chairman. Although Apotheker served barely ten months, he received over $13 million in compensation.^[84] Weeks later, HP announced that a review had concluded their PC division was too integrated and critical to business operations, and the company reaffirmed their commitment to the Personal Systems Group.^[85]

In November 2012, HP wrote off almost $9 billion related to the Autonomy acquisition, which became the subject of intense litigation, as HP accused Autonomy's previous management of fraudulently exaggerating Autonomy's financial position and called in law enforcement and regulators in both countries, while Autonomy's previous management accused HP of "textbook" obfuscation and finger pointing to protect HP's executives from criticism and conceal HP culpability, their prior knowledge of Autonomy's financial position, and gross mismanagement of Autonomy after acquisition.^[82]^: 6

On March 21, 2012, HP said its printing and PC divisions would become one unit headed by Todd Bradley from the PC division, and printing chief Vyomesh Joshi left the company.^[86]

On May 23, 2012, HP announced plans to lay off approximately 27,000 employees, after posting a profit decline of 31% in the second quarter of 2012.^[87] Profits declined because of the growing popularity of smart phones, tablets, and other mobile devices, which slowed down personal computer sales.^[88]

On May 30, 2012, HP unveiled its first net zero energy data center, which used solar energy and other renewable sources instead of traditional power grids.^[89]

On July 10, 2012, HP's Server Monitoring Software was discovered to have a previously unknown security vulnerability.^[90] A security warning was given to customers about two vulnerabilities, and a patch addressing the issues was released.^[91] One month later, HP's official training center was hacked and defaced by a Pakistani hacker known as Hitcher to demonstrate a Web vulnerability.^[92]

On September 10, 2012, HP revised their restructuring figures and started cutting 29,000 jobs.^[93]

2013–2015

On December 31, 2013, HP revised the number of jobs cut from 29,000 to 34,000 up to October 2014. The number of jobs cut until the end of 2013 was 24,600.^[94]^[95]^[96] At the end of 2013 the company had 317,500 employees. On May 22, 2014, HP announced it would cut a further 11,000 to 16,000 jobs, in addition to the 34,000 announced in 2013. Whitman said: "We are gradually shaping HP into a more nimble, lower-cost, more customer and partner-centric company that can successfully compete across a rapidly changing IT landscape."^[97]

During the June 2014 HP Discover customer event in Las Vegas, Whitman and Martin Fink announced a project for a radically new computer architecture called The Machine. Based on memristors and silicon photonics, it was supposed to come into commercialization before the end of the decade, and represented 75% of the research activity in HP Labs at the time.^[98]

On October 6, 2014, HP announced it was going to split into two separate companies to separate its personal computer and printer businesses from its technology services. The split, which was first reported by The Wall Street Journal and confirmed by other media, resulted in two publicly traded companies on November 1, 2015: Hewlett Packard Enterprise and HP Inc. The split was structured so that Hewlett-Packard changed its name to HP Inc. and spun off Hewlett Packard Enterprise as a new publicly traded company.^[99]^[100] Whitman became chairman of HP Inc. and CEO of Hewlett Packard Enterprise, Patricia Russo became chairman of the enterprise business, and Dion Weisler became CEO of HP, Inc.^[101]^[102]^[103]

On October 29, 2014, Hewlett-Packard announced their new Sprout personal computer.^[104]

In May 2015, the company announced it would be selling its controlling 51 percent stake in its Chinese data-networking business to Tsinghua Unigroup for a fee of at least $2.4 billion.^[105]

Facilities

HP's global operations were directed from its headquarters in Palo Alto, California. Its US operations were directed from its facility in an unincorporated area of Harris County, Texas, near Houston. Its Latin America offices were in unincorporated Miami-Dade County, Florida. Its European offices were in Meyrin, close to Geneva, Switzerland,^[106] but it also had a research center in the Paris-Saclay cluster 20 km south of Paris, France. Its Asia-Pacific offices were in Singapore.^[107]^[108]^[109]

HP had large operations in Leixlip, Ireland;^[110] Austin, Texas; Boise, Idaho; Corvallis, Oregon; Fort Collins, Colorado; Roseville, California; Saint Petersburg, Florida; San Diego, California; Tulsa, Oklahoma; Vancouver, Washington; Conway, Arkansas; and Plano, Texas. In the UK, HP was based at a large site in Bracknell, Berkshire, with offices in various UK locations, including a landmark office tower in London, 88 Wood Street.

Its acquisition of 3Com expanded its employee base to Marlborough, Massachusetts, where HP Inc. has been manufacturing its convertible laptop series since late 2019.^[6] HP had a large workforce and numerous offices in Bucharest, Romania, and at Bangalore, India, to address their back end and IT operations. Mphasis, which is headquartered at Bangalore, also enabled HP to increase their footprint in the city, as it was a subsidiary of EDS which the company acquired.

Products and organizational structure

HP produced lines of printers, scanners, digital cameras, calculators, personal digital assistants, servers, workstation computers, and computers for home and small-business use; many of the computers came from the 2002 merger with Compaq. HP as of 2001^[update] promoted itself as supplying not just hardware and software, but also a full range of services to design, implement, and support IT infrastructure.

HP's Imaging and Printing Group (IPG) was described by the company in 2005 as "the leading imaging and printing systems provider in the world for printer hardware, printing supplies and scanning devices, providing solutions across customer segments from individual consumers to small and medium businesses to large enterprises".^[111]

Products and technology associated with IPG included the Inkjet and LaserJet printers, the Officejet all-in-one multifunction printer/scanner/faxes, Indigo Digital Press, the HP Photosmart digital cameras and photo printers, and the photo sharing service Snapfish.

On December 23, 2008, HP released iPrint Photo for the iPhone.^[112]

HP's Personal Systems Group (PSG) was claimed by HP in 2005 to be "one of the leading vendors of personal computers ("PCs") in the world based on unit volume shipped and annual revenue".^[111] PSG dealt with business and consumer PCs and accessories (such as e.g., HP Pavilion, Compaq Presario, and VoodooPC), handheld computing (e.g., iPAQ Pocket PC), digital "connected" entertainment (e.g., HP MediaSmart TVs, HP MediaSmart Servers, HP MediaVaults, DVD+RW drives) and Apple's iPod (until November 2005).^[111]

HP Enterprise Business (EB) incorporated HP Technology Services and Enterprise Services (an amalgamation of the former EDS, and what was known as HP Services). HP Enterprise Security Services oversaw professional services such as network security, information security and information assurance/compliancy, HP Software Division, and Enterprise Servers, Storage and Networking Group (ESSN). The Enterprise Servers, Storage and Networking Group (ESSN) oversaw "back end" products like storage and servers. HP Networking (former ProCurve) was responsible for the NW family of products.

HP Software Division was the company's enterprise software unit, which produced and marketed its brand of enterprise-management software, HP OpenView. From September 2005 HP purchased several software companies as part of a publicized, deliberate strategy to augment its software offerings for large business customers.^[113] HP Software sold several categories of software, which included business service management software, application lifecycle management software, mobile apps, and enterprise security software (the latter of which included, ArcSight, Fortify Software, Atalla and TippingPoint). HP Software also provided software as a service (SaaS), cloud computing solutions, and software services, including consulting, education, professional services, and support.

HP's Office of Strategy and Technology^[114] had four main functions: To steer the company's $3.6 billion research and development investment; foster the development of the company's global technical community; lead the company's strategy and corporate development efforts,^[115] and perform worldwide corporate marketing activities.

HP Labs served as the research arm of HP.

HP also offered managed services by which they provide complete IT-support solutions for other companies and organizations. One example of these was offering "Professional Support" and desktop "Premier Support" for Microsoft in the EMEA marketplace. This was done from the Leixlip campus near Dublin, Sofia and Israel. Support was offered for Microsoft Windows, Exchange, SharePoint, and some office applications.^[116]

Staff and culture

Notable people

Michael Capellas, final chairman/CEO of Compaq; HP President up until November 12, 2002^[117]
Barney Oliver, founder and director of HP Labs
Steve Wozniak^[118]
Tom Perkins
Carly Fiorina, 2016 Republican presidential candidate
Matt Shaheen, management consultant executive at HP Enterprise Services in Plano, Texas; Republican member of the Texas House of Representatives
Enrique Lores, current president/CEO of HP Inc.

Corporate social responsibility

In July 2007, the company announced that it had met its 2004 target to recycle one billion pounds of electronics, toner, and ink cartridges.^[119] It set a new goal of recycling a further two billion pounds of hardware by the end of 2010. In 2006, the company recovered 187 million pounds of electronics.^[120]

In 2008, HP released its supply chain emissions data.^[121]

In September 2009, Newsweek ranked HP No. 1 on its 2009 Green Rankings of America's 500 largest corporations.^[122] According to Environmental Leader (now Environment + Energy Leader), "Hewlett-Packard earned its number one position due to its greenhouse gas (GHG) emission reduction programs, and was the first major IT company to report GHG emissions associated with its supply chain, according to the ranking. In addition, HP has made an effort to remove toxic substances from its products, though Greenpeace has targeted the company for not doing better."^[123]

HP took the top spot on Corporate Responsibility Magazine's 100 Best Corporate Citizens List for 2010.^[124] HP beat out other Russell 1000 Index companies because of its leadership in seven categories including environment, climate changes and corporate philanthropy. In 2009, HP was ranked fifth.^[125]

Fortune magazine named HP one of the World's Most Admired Companies in 2010, placing it No. 2 in the computer industry and No. 32 overall in its list of the top 50. This year in the computer industry HP was ranked No. 1 in social responsibility, long-term investment, global competitiveness, and use of corporate assets.^[126]

In May 2011, HP released a Global Responsibility report covering accomplishments in 2010.^[127] It provides a comprehensive view of HP's global citizenship programs, performance, and goals and describes how HP used its technology, influence, and expertise to make a positive impact on the world. The company's 2009 report won best corporate responsibility report of the year,^[128] and claims HP decreased its total energy use by 9 percent when compared with 2008. HP recovered a total of 118,000 tonnes of electronic products and supplies for recycling in 2009, including 61 million print cartridges.^[129]^{[better source needed]}

In an April 2010 San Francisco Chronicle article, HP was one of 12 companies commended for "designing products to be safe from the start, following the principles of green chemistry". The commendations came from Environment California, an environmental advocacy group, who praised select companies in California and the Bay Area for their conservational efforts.^[130]

In May 2010, HP was named one of the World's Most Ethical Companies by Ethisphere Institute. It was one of 100 companies to earn the distinction of top winner and was the only computer hardware vendor to be recognized.^[131]

HP was listed in Greenpeace's Guide to Greener Electronics that ranks electronics manufacturers according to their policies on sustainability, energy and climate, and green products. In November 2011, HP secured first place (out of 15) in this ranking with a score of 5.9. It scored the most points on the new Sustainable Operations criteria, having the best program for measuring and reducing emissions of greenhouse gases from its suppliers and scoring maximum points for its thorough paper procurement policy.^[132] In the November 2012 report, HP was ranked second with a score of 5.7.^[133]

HP earned recognition of its work in data privacy and security.^[134] In 2010 the company ranked No. 4 in the Ponemon Institute's annual study of the most trusted companies for privacy.^[135] Since 2006, HP has worked directly with the U.S. Congress, the Federal Trade Commission (FTC), and the Department of Commerce to establish a new strategy for federal legislation.^[136] HP played a key role in work toward the December 2010 FTC report "Protecting Consumer Privacy in an Era of Rapid Change".^[137]

After winning nine straight annual "Most Respected Company in China" awards from the Economic Observer and Peking University, HP China added the "10 Year Contribution" award to its list of accolades.^[138]

In its 2012 rankings of consumer electronics companies on progress relating to conflict minerals, the Enough Project rated HP second out of 24 companies.^[139]

Brand

According to a 2009 BusinessWeek study, HP was the world's 11th most valuable brand.^[140]

HP had many sponsorships, such as Mission: SPACE in Epcot at the Walt Disney World Resort.^[141] From 1995 to 1999, and again from 2013 to 2014, HP had been the shirt sponsor of Premier League club Tottenham Hotspur F.C.^[142] From 1997 to 1999 they sponsored Australian Football League club North Melbourne Football Club.^{[citation needed]}

They also sponsored the Jordan Grand Prix from 1999 to 2001, Stewart Grand Prix in 1999, Jaguar Racing from 2000 to 2002, BMW Williams Formula 1 team until 2005 (a sponsorship formerly held by Compaq), and since 2010 sponsored Renault F1.^[143] HP also had the naming rights arrangement for the HP Pavilion at San Jose, whose naming rights were acquired by SAP AG and consequently renamed SAP Center at San Jose.^[144] HP also maintained a number of corporate sponsorships in the business sector, including sponsorships of trade organisations including Fespa (print trade exhibitions), and O'Reilly Media's Velocity (web development) conference.

After the acquisition of Compaq in 2002, HP maintained the Compaq Presario brand on low-end home desktops and laptops, the HP Compaq brand on business desktops and laptops, and the HP ProLiant brand on Intel-architecture servers. The HP Pavilion brand was used on home entertainment laptops and all home desktops.^[145]

Tandem's "NonStop" servers were rebranded as "HP Integrity NonStop".^[146]

Controversies

Employee death in fall from airplane

On December 14, 2000 Elisabeth M. Otto, an employee, fell to her death from a commuter flight shortly after takeoff under suspicious circumstances.^[147] The flight was a routine commute for HP employees, shuttling them from Roseville to Palo Alto, CA. No one reported the incident until after the plane had landed.^[148]

Authorities concluded that Otto had most likely opened the door herself and jumped to her death from an altitude of about 2,000 feet. Her body was later found in a garden. It is believed that the reason why the incident was not immediately reported was due to confusion resulting from the shock of passengers and the loud noise from the open door. Apparently one of the other employees had struggled with Otto while trying to prevent her from jumping but was unable to stop her.^[148]

When the co-pilot came back to close the open door, passengers apparently attempted to explain what had happened but the message was not understood due to the noise. A airplane mechanic reported the incident about 40 minutes after the flight had landed. ^[148]

Restatement

In March 2003, HP restated its first-quarter cash flow from operations, reducing it by 18 percent because of an accounting error. The actual cash flow from operations was $647 million, and not $791 million as reported; HP shifted $144 million to net cash used in investing activities.^[149]

Spying scandal

On September 5, 2006, Shawn Cabalfin and David O'Neil of Newsweek wrote that HP's general counsel, at the behest of chairwoman Patricia Dunn, contracted a team of independent security experts to investigate board members and several journalists to identify the source of an information leak.^[150] In turn, those security experts recruited private investigators who used pretexting,^[151] which involved investigators impersonating HP board members and nine journalists (including reporters for CNET, The New York Times and The Wall Street Journal) in order to obtain their phone records. The information leaked related to HP's long-term strategy and was published as part of a CNET article^[152] in January 2006. Most HP employees accused of criminal acts have since been acquitted.^[153]

Hardware

In November 2007, HP released a BIOS update covering a wide range of laptops with the intent to speed up the computer fan and have it run constantly while the computer was on or off^[154] to prevent the overheating of defective Nvidia graphics processing units (GPUs) that had been shipped to many of the original equipment manufacturers, including HP, Dell, and Apple.^[155] The defect concerned the new packaging material used by Nvidia from 2007 onwards in joining the graphics chip onto the motherboard, which did not perform well under thermal cycling and was prone to develop stress cracks – effectively severing the connection between the GPU and the motherboard that led to a blank screen.^[156]

In July 2008, HP issued an extension to the initial one-year warranty to replace the motherboards of selected models.^[157] However, this option was not extended to all models with the defective Nvidia chipsets, despite research showing that these computers were also affected by the fault.^[158] The replacement of the motherboard was a temporary fix, since the fault was inherent in all units of the affected models from the point of manufacture, including the replacement motherboards offered by HP as a free "repair".^[159]^[160]

Since then, several websites have been documenting the issue.^[161] There have been several small-claims lawsuits filed in several states, as well as suits filed in other countries. HP also faced a class-action lawsuit in 2009 over its i7 processor computers: the complainants stated that their systems consistently locked up within 30 minutes of powering on. Even after being replaced with newer i7 systems, the lockups continued.^[162]

Lawsuit against Oracle

HP filed a lawsuit in California Superior Court in Santa Clara, claiming that Oracle had breached an agreement to support the Itanium microprocessor used in HP's high-end enterprise servers.^[163] On June 15, 2011, HP sent a "formal legal demand" letter to Oracle in an attempt to force them to reverse its decision to discontinue software development on Intel Itanium microprocessors^[164] and build its own servers.^[165] HP won the lawsuit in 2012, which required Oracle to continue producing software compatible with the Itanium processor.^[166] HP was awarded $3 billion in damages against Oracle on June 30, 2016,^[165]^[167] arguing that Oracle canceling support damaged HP's Itanium server brand. Oracle said it would appeal both the decision and damages.

HP wage and hour lawsuit

Several class action firms filed a class action lawsuit on January 12, 2012, against HP Inc. and Hewlett Packard Enterprise ("HP"), entitled "Jeffrey Wall, etc. v. HP, Inc." (formerly known as Hewlett-Packard Company, et al.), Case No. 30-2012-00537897, pending in the Superior Court of California, County of Orange. According to the lawsuit, HP allegedly failed to pay commission payments and incentive compensation that its California sales employees were owed within the timeframes proscribed by California law (Labor Code §§ 201, 202 and 204).^[168] In 2017, FDAzar obtained a settlement of $25 million for class participants and changed the way HP pays incentive compensation and commission payments.^[169]

Takeover of Autonomy

In November 2012, HP recorded a write-down of around $8.8 billion related to its acquisition a year earlier of the UK-based Autonomy Corporation PLC. HP accused Autonomy of deliberately inflating the value of the company prior to its takeover, which the former management team of Autonomy denied.

At that time, HP had fired its previous CEO for expenses irregularities a year before, and appointed Apotheker as CEO and president. HP was seen as problematic by the market, with margins falling and having failed to redirect and establish itself in major new markets such as cloud and mobile services.

As part of Apotheker's strategy, Autonomy was acquired by HP in October 2011. HP paid $10.3 billion for 87.3% of the shares, valuing Autonomy at around $11.7 billion (£7.4 billion) overall, a premium of around 79% over market price. The deal was widely criticized as "absurdly high", a "botched strategy shift" and a "chaotic" attempt to rapidly reposition HP and enhance earnings,^[77]^[79]^[80] and had been objected to even by HP's own CFO.^[81]^[82]^: 3–6 Within a year, Apotheker was fired, major culture clashes became apparent, and HP wrote off $8.8 billion of Autonomy's value.^[81]

HP claimed that this resulted from "accounting improprieties, misrepresentations and disclosure failures" by the previous management, who in turn accused HP of a "textbook example of defensive stalling"^[82]^: 6 to conceal evidence of its own prior knowledge, gross mismanagement, and undermining of the company, noting public awareness since 2009 of its financial reporting issues^[82]^: 3 and that even HP's CFO disagreed with the price paid.^[81]^[82]^: 3–6 External observers generally stated that only a small part of the write-off appears to be due to accounting mis-statements, and that HP had previously overpaid for businesses.^[81]^[170]

The Serious Fraud Office (SFO) and the SEC joined the FBI in investigating the potential anomalies. HP incurred damage with its stock falling to its lowest in decades.^[171]^[172]^[173] Three lawsuits were brought by shareholders against HP for the fall in value of HP shares. In August 2014, a United States district court judge threw out a proposed settlement, which Autonomy's previous management had argued would be collusive and intended to divert scrutiny of HP's own responsibility and knowledge. It essentially engaged the plaintiff's attorneys from the existing cases and redirected them against the previous Autonomy vendors and management for a fee of up to $48 million, with plaintiffs agreeing to end any claims against HP's management and similarly redirect those claims against the previous Autonomy vendors and management.^[174]^[175] In January 2015 the SFO closed its investigation as the likelihood of a successful prosecution was low.^[176] The dispute continued in the US, and is being investigated by the UK and Ireland Financial Reporting Council. On June 9, 2015, HP agreed to pay $100 million to investors who bought HP shares between August 19, 2011 and November 20, 2012, to settle the lawsuits over the Autonomy purchase.^[177]

Another term of the shareholder settlement was to sue Autonomy management, which occurred in London in 2019. HP "failed to produce a smoking gun for the fraud it alleges",^[178] and its accountants admitted that they "never formally prepared anything to attribute the irregularities to the amount of the fraud".^[178]

Israeli settlements

On October 25, 2012, Richard Falk, the United Nations Human Rights Council's Special Rapporteur on the situation of human rights in the Palestinian territories occupied since 1967, called to boycott HP and other businesses that profit from Israeli settlements on occupied Palestinian lands until they brought their operations in line with international human rights and humanitarian law.^[179]^[180] In 2014, the Presbyterian Church (USA) voted to move forward with divestment from HP to pressure Israel in regards to their policies toward Palestinians.^[181] In 2015, the Human Rights Commission of Portland, Oregon, requested to place Caterpillar, G4S, HP, and Motorola Solutions on the city's "Do Not Buy" list.^[182]

Bribery

On April 9, 2014, an administrative proceeding before the SEC was settled by HP consenting to an order acknowledging that HP had violated the Foreign Corrupt Practices Act (FCPA) when HP subsidiaries in Russia, Poland, and Mexico made improper payments to government officials to obtain or retain lucrative public contracts.^[183]

The SEC's order found that HP's subsidiary in Russia paid more than $2 million through agents and various shell companies to a Russian government official to retain a multimillion-dollar contract with the federal prosecutor's office; in Poland, HP's subsidiary provided gifts and cash bribes worth more than $600,000 to a Polish government official to obtain contracts with the national police agency; and to win a software sale to Mexico's state-owned petroleum company, HP's subsidiary in Mexico paid more than $1 million in inflated commissions to a consultant with close ties to company officials, one of whom was funneled money. HP agreed to pay $108 million to settle the SEC charges and a parallel criminal case.^[184]^[183]^[185]

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External links

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