HP has made several management changes in the wake of "unacceptable" performance in its enterprise servers and storage (ESS) unit.
The company reported yesterday that third-quarter revenues in its ESS division fell to $3.4bn - down five per cent on the same period a year ago.
Industry-standard server revenue grew two per cent year over year. Business-critical server revenue declined eight per cent to $828m, with Unix revenue up eight per cent, Alpha down 32 per cent, and NonStop down 25 per cent.
Total storage revenue for the quarter was $709m - down 15 per cent year over year. Online storage declined 23 per cent and near-line storage declined 16 per cent year over year.
Branding the performance "unacceptable", HP chief executive Carly Fiorina announced "immediate management changes".
Three former Compaq executives have been canned: Peter Blackmore, executive vice president of the customer services group; Kasper Rorsted, vice president for HP's Europe, Middle East and Africa division; and Jim Milton, managing director for North America.
HP acknowledged that channel problems had led to lower revenues in Europe. These included channel compensation issues, overly aggressive discounting and a transition to a centralised claims process.
"We have already resolved centralised claims and expect to have compensation issues behind us by Q1 [November 2004-January 2005]," said Fiorina.
Fiorina also noted that HP's troubled implementation of a supply chain system had led to problems with customer orders. But she added that these problems had now been solved.
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