HP’s new CEO Meg Whitman is in a difficult position. The company is recovering from laying off nearly 30,000 employees and its PC business is struggling to grow amidst the unstoppable growth of tablets. Its Palm division has been subsumed and rebranded and webOS is in the process of being open-sourced with no clear indication of a viable business model.
But through all this the company is still making prodigious amounts of money, especially in its enterprise server and software divisions. Its Q3 results were a mix of high revenue ($28 billion) and high losses ($9 billion) due to write-offs, layoffs and a slow economy.
Whitman understands that the future of computing is in the mobile business, especially in smartphones. While HP already plans to release a series of Windows 8 slates, it may also move into smartphones in the next couple of years. Whitman did not outline a timeline, nor an operating system on which the new phone would be based. “We have to ultimately offer a smartphone because in many countries of the world that would be your first computing device,” she told Fox Business News. “We are a computing company, we have to take advantage of that form factor.”
Considering HP’s experience with smartphones, both from a PDA perspective and through its Palm acquisition, we can understand why they’d be trepidatious. There’s no indication of success — look at Nokia and RIM as examples — but the highs can be really, really high.