HP CEO Quits, Citing Family Health Issue HP Names Lores as Its New CEO -- WSJ
August 23 2019 - 3:02AM
Dow Jones News
Imaging chief Lores to succeed Weisler, as shares of PC maker
fall 6.4% after hours
By Patrick Thomas
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (August 23, 2019).
HP Inc. Chief Executive Dion Weisler is stepping down as the
leader of one of the world's largest PC makers later this year for
family health reasons.
Mr. Weisler, who took over as HP's CEO in 2015, will be
succeeded by Enrique Lores, the head of the company's imaging,
printing and solutions business, HP said on Thursday. Mr. Lores, a
Spaniard who joined the company as an intern 30 years ago, will
assume the top job on Nov. 1 and work with Mr. Weisler through
January 2020 to aid the transition, the company said.
"We need to continue to expand into some of our growth
opportunities," Mr. Lores told analysts on an earnings conference
call. The incoming CEO said HP would work on reducing its cost
structure and simplifying its operations. He promised more details
would come at an investor meeting in October.
Shares of HP fell more than 6% after hours.
Mr. Weisler has led HP, which sells computers and printers,
since Hewlett-Packard Co. in 2015 split the company that Bill
Hewlett and Dave Packard started in their Palo Alto, Calif., garage
in 1939. The other business, Hewlett Packard Enterprise Co.,
focuses on selling computer servers, data-storage gear and other
services for corporate-technology departments. Mr. Weisler said he
would eventually leave Silicon Valley to be with his family in
Australia.
When HP split, Mr. Weisler took over what was seen as a legacy
business lacking the growth potential of the Enterprise arm, which
was catering to the booming corporate-technology-services sector.
Despite a decline in industrywide PC sales since 2015, HP has grown
its market share, even as its total shipments also declined,
according to Gartner Inc.
In its latest quarter, HP reported flat revenue after selling
more desktop computers, but gains were offset by weaker performance
in its printing business. HP was the world's No. 2
personal-computer maker by shipments in the second quarter,
according to Gartner.
Revenue from HP's personal-systems unit, which includes its PC
business and sales of tablets, systems for retailers and other
devices, rose 3% in its fiscal third quarter.
"During the last quarter we have seen an economic slowdown, and
this is also having an impact, especially in the consumer side,"
Mr. Lores said, echoing comments from other tech suppliers that
have warned about market challenges.
Sales of printers, printing supplies and related items dropped
5%. HP's printing business has been a focus for investors. It
offers larger profit margins than those from HP's other business
segments, but has struggled recently. Mr. Weisler attributed the
quarter's slump to macroeconomic uncertainty and lower sales in its
Europe, Middle East and Africa region. The printer market is
expected to remain soft, Mr. Weisler said. HP has been trying to
boost its printing-services business, which Mr. Lores called
critical.
Overall, HP reported sales of $14.60 billion, compared with
$14.59 billion a year earlier. Analysts surveyed by FactSet had
expected $14.62 billion of revenue in the quarter.For the quarter
ended July 31, HP's profit rose 34% to $1.18 billion, or 78 cents a
share. Analysts surveyed by FactSet were expecting earnings of 53
cents a share.
The company raised its fiscal-year adjusted earnings outlook to
between $2.18 and $2.22 a share, compared with an earlier forecast
of $2.14 to $2.21. For the current quarter, HP said it expects
adjusted earnings between 55 and 59 cents a share.
Excluding acquisition and restructuring charges and after other
adjustments, HP reported a profit of 58 cents a share, above the 55
cents a share analysts were expecting on an adjusted basis.
Per-share earnings are also expected to rise in fiscal 2020, Mr.
Weisler said.
Write to Patrick Thomas at Patrick.Thomas@wsj.com
(END) Dow Jones Newswires
August 23, 2019 02:47 ET (06:47 GMT)
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