3. Hewlett Packard Memos Leaked; Honesty Not Intended
In the memos, Apotheker warned his leadership that the company was facing "another tough quarter" in the three-month period ending in July, and demanded that top HP executives "watch every penny and minimize all hiring." Current HP employees will surely be thrilled to learn that, according to Apotheker, the company's current workforce plans were "unaffordable given the pressures on our business."
As a result of the leak, HP was forced to report its earnings a day early -- on Tuesday instead of Wednesday -- and slash its outlook.Investors -- shockingly! -- were less than thrilled by the unintended truthiness. And with good reason. It's the difference between coming clean to your spouse about something bad, and having your spouse discover something bad while, say, going through your sock drawer. Indeed, throughout the day Monday, the stock had been trading around the $40 mark. In after-hours trading Monday, HP shares plunged by 4.8%, or $1.91, to $37.89. By the end of trading Thursday, the stock had closed at $36.13. "The consumer PC market continues to be challenged industry-wide," said HP CEO Leo Apotheker during a conference call, adding that the firm's consumer PC revenue was down more than 20% year-over-year. Apotheker said, however, that HP had a solid quarter overall, pointing to strength in servers, storage and networking -- and the firm's $4 billion of operating cash flow. "We're confident that we will continue to see a good performance in our software business," Apotheker told TheStreet on the company's conference call with journalists Tuesday morning. "We're looking to expand our software portfolio -- we want to create a complete platform for software developers