HP's Autonomy Hassles: Tech Weekly Recap

NEW YORK ( TheStreet) -- HP ( HPQ) was the big tech story of the holiday-shortened trading week as the Dow component's fourth-quarter results contained a nasty surprise that sent its stock plunging.

HP's purchase of U.K. software maker Autonomy last year was thrust into the spotlight on Tuesday, as the company recorded a massive writedown of around $8.8 billion related to the deal.

HP said most of the asset impairment charge relates to "serious accounting improprieties, disclosure failures and outright misrepresentations at Autonomy" that occurred prior to HP's $10.3 billion acquisition of the company.

"These improprieties were discovered through an internal investigation after a senior member of Autonomy's management team came forward following the departure of Autonomy CEO Mike Lynch in May," said HP CEO Meg Whitman, during the company's earnings conference call on Tuesday.

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HP has reported the accounting improprieties to the Securities and Exchange Commission and the U.K's Serious Fraud Office, she added, and also intends to seek redress through the civil courts.

"This will take a long time to work through, but we're committed to seeking redress for our shareholders," she said, in response to an analyst's question. "I expect that this will be a multi-year process in the courts of both countries."

The No. 1 PC maker beat Wall Street's earnings estimate for the quarter, but missed the consensus top-line forecast.

Revenue from HP's Personal Systems Group (PSG) was down 14% year over year, while printing sales slipped 5%. HP's services revenue slipped 6% compared to the equivalent quarter last year, while Enterprise Servers, Storage and Networking (ESSN) was down 9%.

Software revenue increased 14% year over year, including the results of Autonomy.

HP shares lost 8.6% during the week to close at $12.44 on Friday.

Apple ( AAPL) also grabbed its share of attention this week, after the tech giant announced its Black Friday sales event.

As part of the promotion, pricing for Apple's iPad with Retina Display started at $458, down from $499. Pricing for the iPad 2 started at $368, down from $399, while pricing for the fourth-generation iPod Touch started at $178, down from $199. Apple announced Black Friday deals on 19 products and accessories.

TheStreet's Chris Ciaccia, however, was unmoved by the promotion, citing better deals for Apple products elsewhere, such as at Best Buy ( BBY).

Apple shares gained 4.5% to end the week at $571.50.

Apple rival Research In Motion ( RIMM) made some big share gains this week as the embattled Canadian handset maker received some much-needed love ahead of its forthcoming BlackBerry 10 launch.

On Tuesday Jefferies analyst Peter Misek upgraded RIM to hold, citing strong carrier support for BlackBerry 10.

On Wednesday, before the market's Thanksgiving break, National Bank Financial analyst Kris Thompson increased his RIM price target to $15 from $12, citing investor opportunities ahead of BlackBerry 10's arrival next year.

RIM shares rose a whopping 36% during the week's trading to close at $11.66.

There was also some M&A news this week, with Cisco ( CSCO) announcing a $1.2 billion deal for privately held cloud networking specialist Meraki late on Sunday.

Meraki touts technology for Wi-Fi, switching, security and mobile device management, which is managed from the cloud. With a growing number of businesses letting employees hook their own smartphones and tablets up to corporate networks (a phenomenon known as Bring Your Own Device, or BYOD), Cisco sees an opportunity to tap into this trend through the Meraki.

The Meraki acquisition comes hot on the heels of Cisco's $125 million purchase of cloud automation and management specialist Cloupia last week.

Cisco shares gained 12% to end the week at $18.84.

Intel ( INTC) CEO Paul Otellini will retire in May, the chip giant announced on Monday.

Otellini, who has led the No. 1 chipmaker since 2005, has decided to retire at the company's annual shareholders' meeting next year, Intel said. The company's board will consider internal and external candidates to succeed Otellini, according to Intel's statement.

Shares of Intel ended the week down 5.2% at $19.72.

Salesforce.com ( CRM) beat analysts' third-quarter estimates on Tuesday, boosted by hikes in subscription/support revenue and its professional services business.

"Salesforce.com is the first enterprise cloud computing company to exceed a $3 billion annual revenue run rate," said CEO Marc Benioff, in a statement.

Salesforce shares rose 13% to close the week at $159.45.

The Thanksgiving holiday and Black Friday may be over, but the holiday shopping season continues apace next week. I hope that you get a chance to rest up this weekend before Cyber Monday kicks off.

-- Written by James Rogers in New York.

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