Hewlitt Packard Computers

Hewlett-Packard's Looking To Retreat From Its Pc Business

Nobody seems to put their hands together with Léo Apotheker, chief executive of Hewlett-Packard, for his latest strategy that he offered last week. It appeared like a turnaround from the business plan that Mr. Apotheker had mastered just few months back. At present H.P. is shelling out high rates for a software company.

It may well have dented the value of its business of personal computers by proclaiming that it is looking to sell it off. The company is looking to move away from PCs to put his whole focus on selling lucrative specialized software and data serving computers to corporate and government.

The enterprise strategy first came to notice by the Tuesday’s evening. IDC said in the 2nd quarter of this year server computer shipments rose by 8.5% and the profit increased by 17.9% from its earlier quarter. In contrast with the PC shipments in the 2nd quarter, it climbed up by 2.6% in the quarter, whilst the profit increased by 6%.

Companies nowadays are looking to invest in data-analysis software and servers to assist them managing as it make sense because of the increasing surge of data, produced inside and outside the company like social network communications,  Web traffic, and other sources.

I.B.M also sold its Personal Computer’s business to a Chinese company in 2005, Lenovo. However, it didn’t tip its hand before the sale, while H.P. was obliged to do so. For several months, I.B.M.’s chief, Samuel J. Palmisano, was in negotiation with Lenovo and paid several visit to to get the assent of their senior government officials.

Must Read Financial Blogs Of The Day: Hewlett-Packard, China's PC ...

&Quot;Now that Hewlett-Packard is “considering strategic options” for its Personal Systems Group — aka its PC business — a logical list of potential buyers is starting to take shape. While for tax reasons it’s probably more likely that HP will spin the unit out as an independent company — there are no taxes when assets are distributed to shareholders — Sterne Agee analyst Shaw Wu, in a note to clients issued this morning, breaks down the possible suitors should HP opt instead for a sale. Topping the list is Samsung, which you might have guessed already. Samsung would make sense, Wu argues, given its “large size and global ambitions.” Samsung has been trying to build a PC business since 1997, when it acquired AST Research, but hasn’t gotten anywhere. But it is the world’s biggest manufacturer of DRAM memory chips, used in PCs; and the largest supplier of NAND flash memory, which forms the basis of solid-state drives that are increasingly built into notebook PCs. It’s also a big maker of LCD displays and notebook batteries. All that vertical integration, combined with HP’s consumer PC footprint — it’s the biggest supplier to Best Buy — would make Samsung the worldwide player it has always aspired to be." (See also Armchair Investment Bankers Put Hewlett-Packard on the Auction Block .) "China has reached yet another milestone in its rise as a consumer of technology by becoming the biggest market for personal computers. In the second quarter, manufacturers shipped 18.5 million PCs in China compared with 17.7 million in the United States, according to IDC, a market research firm. It is the first time that shipments in China have exceeded those in the United States. The shift reflects China’s growing appetite for electronics and the increasing wealth of its huge population. However, it is likely just a temporary phenomenon — at least this year.

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