The Motley Fool Previous Page

HP's Unlikely Savior: Steve Jobs?

Evan Niu, CFA
January 11, 2013

It didn't have to be this way. It was Hewlett-Packard's (NYSE: HPQ) own decision to oust ex-CEO Mark Hurd over a sexual harassment scandal back in 2010. Part of the juicy story entailed falsifying $20,000 in expense reports, which is completely meaningless from a monetary perspective relative to the shareholder value he created -- and how much has been destroyed since he left.

Rise and fall
Hurd's tenure as CEO from March 2005 to August 2010 saw shares more than double at one point, approaching 150% gains. By the time he left office, shareholders were 92% richer than when he started.

HPQ data by YCharts.

After leaving, HP is on its second CEO, Meg Whitman, after similarly booting Hurd's immediate successor Leo Apotheker. The cumulative results so far of Apotheker's and Whitman's efforts have not been as kind to investors.

HPQ data by YCharts.

One man did what he could to save HP and Hurd: Steve Jobs.

Even though Apple (NASDAQ: AAPL) has largely contributed to sluggish PC sales as it attracts users to the Mac and iPad, Jobs always had a deep respect for HP as an iconic giant that helped form Silicon Valley when he was young. In fact, Jobs' first job as a teenager was working for HP, so he's always had a certain respect for the company's legacy.

Shortly before his death, he aptly characterized what was happening to HP: It was "being dismembered and destroyed."

Walk it off
In a recent Bloomberg Businessweek article chronicling HP's fall from grace over the past couple years, there's an interesting episode where Jobs said he was there for Hurd if he wanted to chat. The whole ordeal struck close to home since he, too, had once been spurned by Apple's board over a decade prior.

Oracle (NASDAQ: ORCL) CEO and one of Jobs' closest friends Larry Ellison had called HP's move "the worst personnel decision since the idiots on the Apple board fired Steve Jobs many years ago." Of course, actions speak louder than words and Oracle immediately snapped up Hurd posthaste; he's now Oracle's president and sits on the enterprise software giant's board.

Jobs was know