According to a report in the Wall Street Journal, HP is set to split its printer and PC business into a separate, publicly traded company. This split will be a complete turnaround from the path that HP’s CEO, Meg Whitman, set when she took over from former CEO Leo Apotheker in 2011 and decided to reverse his decision to split the PC and printer business from the corporate hardware and services operations.
The split will give both firms the "flexibility they need to adapt quickly to market and customer dynamics", according to Whitman. HP’s PC and printer business combined contributed about 50% of the company’s quarterly revenue of $27.6 billion (about R309 billion).
The new division will be renamed HP Inc. and will retain the HP logo, while the corporate hardware and services division will be rebranded as HP Enterprise.
Printer and printer cartridge sales remain a profitable business, even though printer sales declined during the last quarter, generating a profit of $1.03 billion (about R11 billion) compared to the PC division’s profit of $346 million (about R3 billion).
The split will happen by the end of the 2015 financial year. Meg Whitman will remain the CEO of HP Enterprise and will be chairman of HP Inc. Dion Weisler, who has been the vice-president of printing & personal systems since 2013, will become the CEO of HP Inc.
Analysts are sceptical about the split, however, as it is unclear how this will help HP compete against its rivals in the PC and printing business. It was also unclear on whether the two divisions would end up competing against each other.
On the other hand, the split open up more money for printer and PC research and development, which will allow HP to make advances in the industry instead of just following along. This might mean innovations in HP ink cartridges and toner cartridges much like Epson’s refillable ink tank systems.