HP pisses away 10.3 Billion

[88m3]

IN AUGUST 2011, when HP said it would buy Autonomy, a British software company that specialises in analysing “unstructured” data, for $10.3 billion, many people thought the Californian maker of computers and printers had paid over the odds. On November 20th HP agreed that it had—and claimed that it had been duped. It said that it was taking a charge of $8.8 billion related to Autonomy in its fourth-quarter results, of which more than $5 billion was “linked to serious accounting improprieties, misrepresentation and disclosure failures”. Some of Autonomy’s former managers, it said (naming no individuals), had inflated the company’s figures before the acquisition.

HP says that it got wind of all this a couple of weeks after Mike Lynch, Autonomy’s founder and former chief executive (pictured), was forced out in late May. Autonomy had not performed as well as HP had hoped. Many other senior managers had already departed. According to HP, one of the remaining members of Autonomy’s management came forward and an investigation, which still continues, began. The accounting sleuths have, says HP, uncovered evidence that Autonomy bloated its sales, for instance by inflating revenue from software packaged with other firms’ hardware. HP spoke to the Securities and Exchange Commission in America and the Serious Fraud Office in Britain last week.

Autonomy’s ex-bosses have flatly denied the allegations. In a statement they noted that HP’s advisers (accountants from KPMG and bankers from Barclays and Perella Weinberg) oversaw “intensive” due diligence. “It is sad to see”, they added, “how [Autonomy] has been mismanaged since its acquisition by HP.”

You may wonder why, if there was jiggery-pokery at Autonomy, it took so long to come to light and went unnoticed by so many pairs of eyes. Autonomy was a listed company; Deloitte, its auditor, signed its accounts; HP’s advisers ran the rule over it; and the buyer’s board approved the merger. Most of today’s board were in place at the time. “We feel terribly about that,” Meg Whitman, the chief executive, told analysts, but “the board relied on audited financials.” She also noted that her predecessor, Léo Apotheker, and the then head of strategy, Shane Robison, “who led the deal” and were thus “the two people that should be held responsible”, had departed.


You may also wonder when the bad news from HP will ever end. Mr Apotheker was forced out a few weeks after agreeing on the Autonomy deal, having spent less than a year in charge: shareholders took fright not only at the purchase but also at his plan to spin off the company’s PC division. (Mr Apotheker has said he is “stunned and disappointed” by developments.) Ms Whitman, the former boss of eBay, has spent most of her tenure dampening expectations of a speedy recovery in HP’s fortunes. She has succeeded, after a fashion: the company’s share price has fallen by almost half since she took over (see chart). The Autonomy write-off was the second huge one in successive quarters: in July HP wrote down the value of EDS, an IT services company it had bought in 2008 for $13.9 billion, by $8 billion. In the fourth quarter it reported year-on-year declines in revenues from PCs, printers, services, servers***—just about everything, in fact, except software, where revenue was up by 14%. Despite everything, HP says it still considers Autonomy a decent fit.

HP and Autonomy: Conflicting accounts | The Economist

The comments are worth the read

 

[Slaimon Khan Shah]

People need to avoid with the evil lyeing. It's only bad to do the evil lyeing.

 

[kermit da hustla]

i always laugh at how they phrase these "losses." do they really think 10.3 billion just disappeared? it went into someone's pockets.

 

[duckbutta]

I used to work at HP...easily the most "wtf" company I have ever worked for...

January 2009 and January 2010... Dear valued employee...as you know HP is a market leader blah blah blah...due to the economy blah blah blah...we will be taking 5 % of your salary for...wait what

December 2009 and December 2010...Dear valued employee...as you know HP is a market leader...blah blah blah...we met our margins blah blah blah...we will be giving you a "spot bonus" of 5 % of your salary...wat what

HP farmed out it's internal helpdesk...to India...

Entire departments would get fired literally overnight...There was a group in India who did all the the corporate backups for a division of HP...I use to talk to the guys via IM, and the group had about 15 people in it, so there was always at least 1 person online...I come in one morning, and all of these guys are gone, all offline...a guy in the division says he needs a restore...gets told "oh we let those guys from India go the corporate office out in Houston does the backups and restores now"...literally within 5 minutes of him saying that one of the corporate sys admins from houston hit me up like "hey you know anything about netbackup? They told us we are in charge of it now and none of us have ever used it? You know how to load a tape library?" Were where the tape libraries? In a datacenter...in... India

I know of a technician...just a single hardware technician who did not do anything but put together R&D testing machines...somehow his cellphone number got mistaken...and published, internally...as a support number for all types of stuff...dude would get calls at 3:am from an engineer in Morocco who was like "Whenever I try to SSH to a server it says authentication failed...can you has help?" Hardware tech dude is like "SSWhat?"

 

[trollol]

audited financials dont mean sh1t

 

[Ed MOTHERFUCKING G]

They've had shytty management going as far back as that AWFUL Carly Florina.

The purchase of palm was some jokey smurf shyt too

 

[jadillac]

yeah it went into someones pocket

 

[Ed MOTHERFUCKING G]

audited financials dont mean sh1t

Edit: ahh, nevermind

Sent from Seattle, by way of Ann Arbor on Tapatalk: The Remix

 

[TLR Is Mental Poison]

yeah it went into someones pocket

Always someone on the other side of a loss

BBC News - Autonomy shares jump 72% on sale to Hewlett Packard

As goofy as the company was I bet the only shareholders were execs who got paid options for bonuses

HP came to them... they came in their pants

 

[BlvdBrawler]

I used to work at HP...easily the most "wtf" company I have ever worked for...

January 2009 and January 2010... Dear valued employee...as you know HP is a market leader blah blah blah...due to the economy blah blah blah...we will be taking 5 % of your salary for...wait what

December 2009 and December 2010...Dear valued employee...as you know HP is a market leader...blah blah blah...we met our margins blah blah blah...we will be giving you a "spot bonus" of 5 % of your salary...wat what

HP farmed out it's internal helpdesk...to India...

Entire departments would get fired literally overnight...There was a group in India who did all the the corporate backups for a division of HP...I use to talk to the guys via IM, and the group had about 15 people in it, so there was always at least 1 person online...I come in one morning, and all of these guys are gone, all offline...a guy in the division says he needs a restore...gets told "oh we let those guys from India go the corporate office out in Houston does the backups and restores now"...literally within 5 minutes of him saying that one of the corporate sys admins from houston hit me up like "hey you know anything about netbackup? They told us we are in charge of it now and none of us have ever used it? You know how to load a tape library?" Were where the tape libraries? In a datacenter...in... India

I know of a technician...just a single hardware technician who did not do anything but put together R&D testing machines...somehow his cellphone number got mistaken...and published, internally...as a support number for all types of stuff...dude would get calls at 3:am from an engineer in Morocco who was like "Whenever I try to SSH to a server it says authentication failed...can you has help?" Hardware tech dude is like "SSWhat?"

I work for Bank of America.

HP provides the service on our network infrastructure, and provides leases on all of our hardware.

I believe every word you just typed.