BREAKING: HP shutting down webOS device operations, will "continue to explore options"
We knew HP was having trouble selling webOS devices, and as part of their quarterly fiscal announcement, they announced that they plan to discountinue operations for webOS devices, to include the TouchPad and webOS phones.
In the press release sent out this afternoon, HP confirmed that they were in discussions for an acquisition of Autonomy and announced preliminary results for Q3 2011, with revenue up to $31.2 billion in comparison to $30.7 billion this time last year.
But this is PreCentral - we don't care about any of that, and we're pretty sure you don't care either. Needless to say, our minds are completely blown by this news. HP didn't give any reason in their press release for the shut down (we've reached out for comment and will update if/when we get it).
So what does this mean? The statement was carefully worded to state that they're "discontinuing operations for webOs devices," not webOS as an operating system. If anything, this should add fuel to the second option we discussed earlier today when the shocking word of an HP breakup first surfaced: HP is more interested in webOS than devices. They tried to give it a go with hardware, but quickly realized that they weren't going to be able to make it work without massive long-term investment and commitment. So less than a year after acquiring all of Palm for $1.2 billion, we're looking at a hazy future for webOS.
Today it became approximately one thousand times harder to recommend anybody buy a TouchPad or Veer or Pre3. The entire ecosystem is in doubt. Now it's pretty clear why HP has had trouble telling us when or where the Pre3 might actually be available. There's the possibility that maybe someday some other mobile device manufacturer might pick up webOS and use it on their handsets, but if/when that happens is anybody's guess.
(full press release after the break)
- HP "not walking away from webOS," say execs at all-hands webOS GBU meeting
- HP not willing to make the investments needed to drive webOS to greater marketshare
HP Confirms Discussions with Autonomy Corporation plc Regarding Possible Business Combination; Makes Other Announcements
PALO ALTO, Calif.--(BUSINESS WIRE)--HP (NYSE: HPQ) today commented on the recent announcement by Autonomy Corporation plc (LSE: AU.L). HP confirms that it is in discussions with Autonomy regarding a possible offer for the company.
HP also reported that it plans to announce that its board of directors has authorized the exploration of strategic alternatives for its Personal Systems Group (PSG). HP will consider a broad range of options that may include, among others, a full or partial separation of PSG from HP through a spin-off or other transaction.
In addition, HP reported that it plans to announce that it will discontinue operations for webOS devices, specifically the TouchPad and webOS phones. HP will continue to explore options to optimize the value of webOS software going forward.
HP today announced preliminary results for the third fiscal quarter 2011, with revenue of $31.2 billion compared with $30.7 billion one year ago.
In the third quarter, preliminary GAAP diluted earnings per share (EPS) was $0.93 and non-GAAP diluted EPS was $1.10, compared with third quarter fiscal 2010 GAAP diluted EPS of $0.75 and non-GAAP diluted EPS of $1.08. Non-GAAP diluted EPS estimates exclude after-tax costs related primarily to the amortization of purchased intangible assets of approximately $0.17 per share and $0.33 per share in the third quarter of fiscal 2011 and fiscal 2010, respectively.
For the fourth fiscal quarter of 2011, HP estimates revenue of approximately $32.1 billion to $32.5 billion, GAAP diluted EPS in the range of $0.44 to $0.55, and non-GAAP diluted EPS in the range of $1.12 to $1.16. Non-GAAP diluted EPS guidance excludes after-tax costs of approximately $0.61 to $0.68 per share, related primarily to restructuring and shutdown costs associated with webOS devices, the amortization and impairment of purchased intangibles, restructuring charges and acquisition-related charges.
HP estimates full-year FY11 revenue will be approximately $127.2 billion to $127.6 billion, down from its previous estimate of $129 billion to $130 billion. FY11 GAAP diluted EPS is expected to be in the range of $3.59 to $3.70, down from its previous estimate of at least $4.27, and FY11 non-GAAP diluted EPS is expected to be in the range of $4.82 to $4.86, down from its previous estimate of at least $5.00. FY11 non-GAAP diluted EPS estimates exclude after-tax costs of approximately $1.16 to 1.23 per share, related primarily to restructuring and shutdown costs associated with webOS devices, the amortization and impairment of purchased intangibles, restructuring charges and acquisition-related charges.
HP will host a conference call with the financial community today at 2 p.m. PT / 5 p.m. ET to discuss these announcements well as HP’s third quarter 2011 financial results. The call is accessible via an audio webcast at www.hp.com/investor/2011q3webcast.
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