Best Buy to HP: "Do We Need a Receipt to Return These TouchPads?"

Not that this should come as a surprise to anyone, but sales of Hewlett-Packard's (NYSE: HPQ  ) TouchPad are officially embarrassingly few and far between.

According to All Things D, big-box electronics retailer Best Buy (NYSE: BBY  ) has more than 200,000 TouchPads taking up valuable space in its stores and warehouses. The report indicates that the company had initially taken delivery of 270,000 of the ill-fated tablet and has been able to move only 25,000 of them into the hands of buyers. 

Allegedly, the retailer is so distraught that it's even asking HP to take them back and that HP has sent a senior executive to smooth things over and discuss the matter further. This comes just before HP's quarterly earnings release on Thursday. Your guess is as good as mine about how much detail the company will divulge about TouchPad sales.

To an extent, HP's erratic pricing behavior has exacerbated things. Since the tablet's launch on July 1 for $500, the doomed device saw heavy discounts offering it for as low as $385 roughly a month later. Next, the price was permanently cut by 20% to $400. For the few potential TouchPad buyers out there, these unpredictable price changes give them an incentive to wait and see whether the price drops further, which hurts sales further, which may lead to more price drops... you get the picture. It's kind of like deflation, but only with TouchPads.

Can anyone touch Apple's (Nasdaq: AAPL  ) iPad? Not yet, at least when it comes to sales. It looks like HP may not be getting the bang for its buck that it envisioned when picking up Palm.

Fool contributor Evan Niu owns shares of Apple, but he holds no other position in any company mentioned. Check out his holdings and a short bio. The Motley Fool owns shares of Apple and Best Buy. Motley Fool newsletter services have recommended buying shares of Apple and Best Buy and creating a bull call spread position in Apple. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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  • Report this Comment On August 18, 2011, at 12:22 AM, Oldfool103 wrote:

    I bought my Apple shares back in 2008--after a year of badgering my advisor--because I had read they were working on a "category killer," much like the iPod. So far, it appears to be true. (Other than Samsung, and they never report their sales so it is hard to know what to think, it has been "Bye bye baby" to all of the great pretenders.)

  • Report this Comment On August 18, 2011, at 12:42 AM, ConstableOdo wrote:

    I remember earlier in the year listening to jackass analysts and pundits claiming that the iPad would be steamrollered over by less expensive tablets from at least 50 Android tablet vendors, the RIM PlayBook and HP's WebOS tablet and possibly a Windows 7 tablet or two. Guess what? Those knucklehead know-it-alls were just pushing FUD because clearly only Apple understands what it takes to sell tablets in quantity. Apple makes the highest-quality tablet, has the best retail marketing strategy and has the best customer service by a longshot. With Apple's economies of scale growing ever larger by each quarter, Apple's lead in the tablet market can only solidify.

    What will make me the happiest since I'm an Apple shareholder, will be for Apple to shut up those jackass fund managers who claim that Apple will be threatened by Android devices and that Apple can't possibly grow revenue any further than it is now. There are just too many idiots with far too much manipulating power controlling Wall Street who don't have a clue about running a business as well as Apple does.

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