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HP's Monstrous Writedown

By Evan Niu, CFA - Nov 21, 2012 at 9:01PM

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The turnaround clock is ticking.

PC giant Hewlett-Packard ( HPQ -1.81% ) has recently said it was taking an $8.8 billion impairment charge related to its 2011 acquisition of British software maker Autonomy. That was a deal put together by ex-CEO Leo Apotheker. The big twist in this story is that HP says Autonomy defrauded it by fudging the numbers and overvaluing itself. Current CEO Meg Whitman has now overseen approximately $20 billion in writedowns. Going forward, HP needs to refocus on products, which is exactly what Whitman said on the conference call. It will launch tablets running Microsoft ( MSFT -1.79% ) Windows 8, then eventually a smartphone to challenge Apple ( AAPL 3.16% ) and Google ( GOOGL -2.50% ).

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Stocks Mentioned

HP Inc. Stock Quote
HP Inc.
HPQ
$35.28 (-1.81%) $0.65
Apple Inc. Stock Quote
Apple Inc.
AAPL
$165.30 (3.16%) $5.06
Microsoft Corporation Stock Quote
Microsoft Corporation
MSFT
$330.59 (-1.79%) $-6.04
Alphabet Inc. Stock Quote
Alphabet Inc.
GOOGL
$2,837.95 (-2.50%) $-72.66

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