HP to keep hold of Personal Systems Group and stay in the PC business

HP has decided against spinning off its Personal Systems Group (PSG) and will remain in the PC business for the foreseeable future.

The idea was introduced in August by former chief executive Léo Apotheker, but current chief executive Meg Whitman stated that, after reviewing the possible impact, HP has reversed the decision and will re-commit to the market.

"HP objectively evaluated the strategic, financial and operational impact of spinning off PSG. It is clear after our analysis that keeping PSG within HP is right for customers and partners, right for shareholders, and right for employees," she said.

Whitman's decision was not unexpected, according to analysts. 

"There are issues with the PC business, but it is a huge revenue stream and it gives HP a scale and component mindshare that helps in all of its hardware businesses. HP's supply chain in unequalled," Roger Kay, founder and principle analyst at Endpoint Associates, told V3.

The decision is a final snub to Apotheker and his plan to shift HP towards a software and services business.

Apotheker was removed by HP's board of directors shortly after announcing his intention to rid HP of the PSG and the webOS hardware lines, ending a run of less than a year as chief executive.

"He made a bone-headed decision. Dell and others have been making hay while the cloud of uncertainty has hung over HP, and have reaped some benefits from the damage that Léo did," said Kay.