Hewlett-Packard’s share prices have fallen as reports claim that the company is considering selling its computer business and investing in the software company Autonomy. The strategy surprised the industry as Hewlett-Packard dominates around 17.6% of the market meanwhile Dell comes second with 12.5% of the market share thus highlighting the brutality of the industry.
Autonomy was originally created by Cambridge University with the purpose of specialising in pattern recognition technologies. It currently aids around 25,000 customers worldwide, with over 400 software companies using it to power their company. It also powers some of the Top 10 banking firms in the world. The deal would mean that HP would severely reduce the sales of tablet PCs and smartphones in favour of software; it is believed that Apple dominates the smartphone and tablet sector therefore meaning that there is little room for competitors. HP see the transition from computer to software to be practical and more profitable in the long term. HP offered the Autonomy £7.1billion which is around 64% above the estimated target value of the software firm. Consequently, shares dropped to $23.58 at closing on Friday.
On Thursday 18th August, HP announced that the company’s quarterly results had fallen in line with its predictions and had risen 1.6% since 2010, although Hewlett-Packard dropped its annual predictions from $130bn to $127.6bn. Likely contenders for the company are Chinese companies Lenovo and Huawei.
Sources:
BBC News
(http://www.bbc.co.uk/news/business-14582489)
http://www.autonomy.com/
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment