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Meg Whitman’s statements require some scepticism. She denied vociferously she would run Uber just before pitching herself to the ride-hailing company’s board. She was “not going anywhere” as of September but weeks later she has quit Hewlett Packard Enterprise.
A valedictory claim that she delivered a shareholder return of 220 per cent is correct, as she framed it on Tuesday’s conference call. But Ms Whitman is picking the start date as her first big analysts’ meeting at HP in October 2012 rather than her first day as chief executive in September 2011. Use that more natural point and the total return is 120 per cent, compared with the S&P 500’s total return of 150 per cent over the period.
Along the way, Ms Whitman has chopped up HP so thoroughly that it is difficult to judge the success of her original five-year plan. It is also hard to get excited about a company still soldiering on with servers and storage, in the HP Enterprise business that was spun off two years ago, and PCs and printers, in the legacy HP Inc.
Yet that is also the point. As new start-ups and Amazon Web Services rose, Ms Whitman had to adapt to the cloud and mobile computing which threatened HP’s core business. At the same time, she wrestled with huge costs and legacy disasters such as the $10bn acquisition of Autonomy. HP could have withered faced with these energetic challengers. It is still in the game and that is testament, in part, to her vigorous reinvention of the company.
From here, it remains a slog, however. HPE’s “normalised” free cash flow is expected to be $2bn next year but reported free cash flow will only be $1bn, sapped by yet more restructuring costs. Overall revenues increased 5 per cent in the third quarter but servers, still the largest segment, saw a 5 per cent slide. This decline could worsen if yet more of the world’s computing shifts to alternative hardware in the public cloud.
As for Ms Whitman, she ruled out a move to a competitor and another shot at politics. On past form, that means all options are on the table.
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