Nov. 20 - Hewlett-Packard takes an $8.8 billion charge and sparks a war of words with the former management of Autonomy, the company it acquired last year.Conway G. Gittens reports.
The daily digit today is $8.8 billion. It is a charge that Hewlett-Packard had to take as a result of its purchase of an enterprise software firm, Autonomy. HP says it found "serious accounting improprieties" at Autonomy that had occurred before HP bought it in 2011 for $11.5 billion. But Autonomy's former management is fighting back, with a spokeswoman calling the claims "false". Analysts criticized HP for overpaying on the deal, but the investment was a part of a multi-year restructuring aimed at shifting Hewlett-Packard towards enterprise services. The multi-billion dollar charge tops a long list of Hewlett-Packard's problems: quarterly revenues were down 6.7 percent, profits for main business units tumbled, with the personal computer division recording the steepest drop, resulting in a net quarterly loss of almost $7 billion. And comes one quarter after HP took an almost $11 billion charge for another unit.