HP's embattled chief executive, Meg Whitman, stood before financial analysts yesterday to lay out the latest strategy to restore company fortunes – she might be forgiven for wishing she hadn't bothered.
Even as she spoke, the markets were giving their verdict: shares plummeted to their lowest point in nearly a decade.
Anyone that's followed the IT industry for long enough knows to take market sentiment with a pinch of salt: these are after all the whizz kids that decided a business selling cat litter online was worth $82m. Nonetheless, the judgement that HP is today worth no more than it was nine years ago will have sent alarm bells ringing at Palo Alto.
The stock market currently values HP at $29.3bn. Since it was last worth that much, it has spent $40bn acquiring companies. You don't need to be a financial genius to know that sort of carelessness bodes ill.
One of the biggest acquisitions HP has made in the past decade was that of EDS. It was supposed to be a $14bn masterstroke that transformed HP, shifting its reliance away from hardware to the more profitable services space.
Instead, EDS has proved to be a millstone.
In August, HP took a $8bn write down on the value of its service business – largely reflecting the dwindling value of that HP acquisition. Yesterday Whitman revealed that its services unit would see income decline by as much as 13 percent over the coming year. Worse, margins could be nothing.
It's not just in services that HP has problems. Its printing business used to be the company's bedrock; today, the industry is shifting away from printing pages.
As part of its medicine, HP plans to slash product lines and streamline sales teams.
According to widespread reports, Whitman told analysts yesterday that it may take as long as five years to turnaround the company.
“HP has a powerful set of assets, a culture of engineering innovation and a trusted brand. Now, we have to focus on bringing our incredible assets together to deliver for our customers, employees and shareholders," she said.
The big question for Whitman is whether that last group will give her time.
Any investor expects a return on their money, but few tech investors want to wait years. Many of them may soon start to question whether the best way to realise value from that “powerful set of assets” is to break the company up.
It would be some time before enough investors are willing to take that nuclear option. But unless Whitman can get the stock price moving upwards, the threat is likely to remain.
Moon's dark side is mountainous, rugged and never visible from the Earth
The groundwater basins in some areas of Tehran have been damaged irreversibly
This is the first time that any spacecraft on Mars has recorded air vibrations on the planet
Arctic sea ice is thickening at a faster rate during winter, thus slowing down long-term decline: NASA
But, the seasonal ice growth could only delay the demise of the Arctic ice cap for a few more decades