HP Quarter Expected Strong, Dell in QuestionBy Reuters | Posted 2010-11-17 Email Print
In spite of the drama swirling around technology giant HP over its ousting of CEO Mark Hurd and hiring of ex-SAP CEO Leo Apotheker, the company is expected to report a strong quarter. Meanwhile, rival Dell's quarter is more in question as industry watchers caution on Dell's reliance on government spending at a time when such spending appears to be slowing.
SAN FRANCISCO, Nov 16 (Reuters) - Hewlett Packard Co (NYSE:HPQ) hopes to shift investors' attention from its internal upheaval to financial performance, with an imminent quarterly report expected to again showcase its reputation for solid -- if unspectacular -- growth.
HP shares have suffered after months of grappling with the messy exit of Mark Hurd as chief executive, followed by a nasty public fight with Oracle Corp (NASDAQ:ORCL) and its CEO Larry Ellison over the hiring of Silicon Valley outsider Leo Apotheker as its new chief.
HP's financial report comes next Monday, following that of longtime rival Dell Inc (NASDAQ:DELL), which will be closely watched for signs of the same cooling in government spending that plagued Cisco Systems Inc (NASDAQ:CSCO).
Amid the dismal headlines, HP investors have two burning questions: Did performance slip with Hurd's exit? And what exactly is this Apotheker fellow all about?
Morningstar analyst Michael Holt said there was no evidence HP's execution was hurt by Hurd's departure -- or the jockeying by executives to succeed him.
"They did execute, and I think they will come in and give that signal of stability," Holt said. "They're really trying to calm the waters with investors."
Gleacher & Co analyst Brian Marshall said Wall Street is eager to hear from Apotheker, who started work on Nov. 1 but remains a mystery to many investors.
"Leo has to make a good appearance," Marshall said. "The numbers are important, but it's more about how he comes across."
Apotheker's ride has not been smooth thus far. Oracle claims he is ducking a subpoena to testify in its high-profile copyright case against SAP AG (DE:SAPG), where Apotheker was once CEO. HP says Oracle is simply trying to harass him.