Hewlett Packard FY 2Q15 Earnings Call Notes

Significant market challenges

“we faced significant market challenges due to currency movements, softness in PCs, home printing, and IT outsourcing markets and execution challenges in pockets of the business that require more work.”

Markets are shifting rapidly

“as you will recall last October we announced our plan to separate HP into two independent Fortune 50 companies. Today I’m more convinced than ever that this is the right thing to do. Over the past six months we’ve seen the markets continue to shift and evolve at a rapid pace.”

Enterprise customers need help moving to a hybrid infrastructure

“In Hewlett-Packard Enterprise our customers are demanding services and solutions that will help them manage traditional IT better, while planning their journey to a hybrid infrastructure.”

Lots of things have needed to happen to complete separation

“we’ve made substantial progress across a number of areas that gives me confidence that we’ll complete the separation by the end of our fiscal year. We’ve completed the leadership and organizational structures for each company and largely completed our work force assignments. We’ve made progress in recruiting new board members for each company. We’ve evaluated how we can best meet customer needs and as a result have planned a new, optimized, partner driven go-to-market approach in over 50 global markets. Our real estate teams have made decisions about our sites around the world, and we’ve performed thousands of hours of IT system testing ahead of the separation”

Re-pricing from currency movements did impact demand

” the currency movements and the associated re-pricing impacted demand. We managed to offset the currency impact to company level operating profit in Q2 through hedges and re-pricing.”

PC is weaker, but server stronger

“While the PC market is weaker than we anticipated, we’re actually doing better in some of the businesses, like Industry Standard Servers. So while the cash flow might be slightly lower in PCs, depending on how the market evolves, we’re actually going to more than make that up”