Hewlett-Packard's Meg Whitman: Has her turnaround strategy failed already?

The computer giant is bleeding money, sparking criticism that Whitman has failed to adapt to a rapidly changing tech industry

Hewlett-Packard CEO Meg Whitman
(Image credit: Imaginechina/Corbis)

This week, computer giant Hewlett-Packard announced that it had lost $8.86 billion in the third quarter, a record for the 73-year-old company. The loss — the latest in a string of bad news for the company, whose stock is down 32 percent this year — raised serious doubts about CEO Meg Whitman's turnaround strategy. Upon taking the helm in September 2011, Whitman rejected her predecessor's plan to spin off HP's personal computer and printer businesses in order to focus on software and IT services, a strategy IBM pursued with great success. Whitman decided to keep HP intact, pledging to retain its status as the world's No. 1 maker of personal computers, while simultaneously developing the company's other businesses. Has Whitman's strategy failed?

Yes. Everything is going wrong: The fact is "that it's tough to be in the PC business these days, especially if you're a decades-old American company, and it's not going to get easier any time soon," says Paul Vigna at The Wall Street Journal. HP "completely missed" the "rapid move" to smartphones, and its "PC business is under assault from all sides." In addition, its recent acquisitions of EDS and Autonomy, both of which were meant to drive the transition to software and IT services, have turned out to be disasters. "The path out from this PC manufacturing morass, toward the IBM model, is long and murky," and Whitman has "got her work cut out for her."

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