HP will keep cleaving

Hurd knows best

By Ashlee Vance in Mountain View • Get more from this author

Posted in Financial News, 13th December 2006 10:18 GMT

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HP's CEO Mark Hurd plans to stick with what he knows best: cost cutting.

Hurd – who sharpened his fat cleaver at NCR – plans to squeeze HP even more in the coming year. Some might think this impossible after HP cut its workforce by 10 per cent, sliced into the company retirement plan and consolidated its internal IT functions. The CEO, however, vowed to keep right on cutting, during an analyst conference in New York.

"We are a company that is transforming; we are not a company that is transformed," he said. "We have a lot more costs to take out, and we have to become as efficient as possible."

HP likes to claim that it's more than a budgeting experiment. But it has set modest growth goals of increasing revenue 4 per cent to 6 per cent in 2008.

Such a revenue hike seems unlikely to inspire the same investor fondness in HP stock that has held during Hurd's tenure. HP shares remain near their 52-week high of $40.85, having surged from close to $28 per share last December. ®

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