Hewlett-Packard Splits Into Two Today

It’s the end of an era. Silicon Valley giant Hewlett-Packard (HP), with 300,000 employees at 651 locations in 120 countries, is a thing of the past. In its place are born two entities that bear its initials, HP Enterprise and HP Inc.


The Palo Alto garage where the company was created in 1938 by two Stanford University graduates Bill Hewlett and Dave Packard has since been designated a California historic landmark. HP will best be remembered for its engineering knowhow and laid-back corporate culture, its workplace innovations including flexible schedules and the open space office even as it grew into a multinational giant selling a wide range of computer gear and commercial tech services. Through growth and multiple acquisitions, the company grew into a colossus difficult to manage and falling behind the curve of transition to mobile and cloud computing.

HP Enterprise will be led by company CEO Meg Whitman and focus on software and business services while HP Inc, under Dion Weisler, will keep the personal computer and printer operations. Both companies would begin trading independently on Wall Street from Monday, November 2. The two new companies will, hopefully, be more nimble and, with less to focus on, do core things better.

The company’s current revenue of $100 billion will be roughly divided into equal halves, according to analysts. But each of them will face significant challenges: Demand for PCs and printers is continuing to decline, as more people use mobile devices and store their documents and photos online in the cloud. And in the commercial computing sector, more businesses are using online software instead of buying servers and other hardware from companies like HP.

The market value of HP today is roughly $50 billion, half its annual revenue.

The split would reportedly result in the laying off of about 30,000 employees with many others being moved to low cost countries.

HP Enterprise will keep the headquarters building at 3000 Hanover St., in Palo Alto, while HP Inc. moves up the hill to 1501 Page Mill Road, a 1960s-era building that contains the original offices of the founders.