Hewlett-Packard Co. announced Thursday that it is getting out of the smartphone and tablet computer business and may put its personal computer division up for sale.
In a conference call Thursday, new CEO Leo Apotheker said, “Our WebOS devices have not gained enough traction in the marketplace with consumers.” He cited “significant competition” among other factors in dropping the TouchPad.
He announced that HP will stop making tablet computers and smartphones by October, and the company plans to buy business software maker Autonomy Corp. for about $10 billion in one of the biggest takeovers in HP’s 72-year history.
Michael Thacker from HP’s corporate office in Palo Alto said Friday, “We announced that we are exploring strategic alternatives for our Personal Systems Group and that the process could be completed within approximately 12-18 months.
“We have announced no immediate changes to our existing PSG business and do not expect to before a thorough evaluation has been completed. Our existing PSG operations including manufacturing, support, sales and other operations currently remain in place.”
HP, the largest technology company in the world by revenue, will continue to sell servers and other equipment to business customers.
Those businesses currently don’t generate as much revenue for HP as PCs, but they have higher profit margins.
Apotheker would not say whether any jobs will be cut.
Some analysts say HP’s consideration of getting out of the PC business is intended to free up resources to its business products and consulting services, the focus of HP’s 153,000 square-foot center in the Conway Development Corp.-owned Meadows Office and Technology Park in Conway.
The center opened in 2010 and employs more than 1,200 workers.
“As far as I know,” Thacker said, “operations in place in Conway will stay the same.”
The $28 million facility was built with a CDC bond issue. The City of Conway developed and owns the HP site and CDC owns the facility. HP leases the facility from CDC through a 20-year lease arrangement.
About $8 million in city funds were spent to develop The Meadows and improve the surrounding street infrastructure, and about $2 million of this was for development specific to the HP site.
All $8 million was paid out of the city’s economic development fund, which is generated by a Conway Corp. electricity franchise fee.
Jamie Gates, senior vice president of CDC, said Friday that HP’s announcement reflects the company’s strategic shift.
“There are a number of business groups at the Conway location, and most do not deal with consumer products. The impacts in Conway, if there are any, will not be realized here for some time,” Gates said.
“The best thing for Conway is for HP to continue to be profitable. We are optimistic about our future with HP.”
At Friday’s close, HP’s stock (HPQ: NYSE) traded at $23.66, down $6.52, a 21.60 percent drop. The 52-week high was $49.39.
(Log Cabin staff writer Becky Harris can be reached at firstname.lastname@example.org and 505-1234. The Associated Press contributed to this report.)