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Meg Whitman is to step aside as chief executive officer at Hewlett Packard Enterprise, ending a turbulent six-year turnround effort that eventually saw one of Silicon Valley’s formative companies broken into four different businesses.
The former eBay boss announced her planned exit late on Tuesday, as HPE issued a downbeat earnings forecast for the current quarter and its shares fell by as much as 7 per cent in after-hours trading.
Ms Whitman had hinted that she was looking to step back from the CEO position after narrowly missing out on the top job at Uber this summer. At the time, she said that she had achieved the main goal she set when becoming CEO in 2011, of turning around a company that was losing ground in all its main markets.
She first tried to hold HP’s disparate businesses together, before spinning off the company’s printer and PC division into the new HP Inc and shedding its software and services businesses through combinations with other companies. In a statement on Tuesday, Ms Whitman said the original HP had become “four industry-leading companies that are each well positioned to win in their respective markets”.
However, HPE, the enterprise computing division she has run since the 2015 break-up, projected that it would produce earnings of only 1 to 5 cents a share in the current quarter. Even after taking account of 19 cents a share of costs linked to restructuring and amortisation, the forecast was still well below the 28 cents a share analysts had been expecting.
Ms Whitman rejected suggestions that she had yet to prove that HPE was on the right track as it tries to become less dependent on selling servers and storage equipment and reposition itself to benefit from the rise of new cloud computing architectures.
After a series of restructurings, HPE is “far more nimble, far more agile, and frankly a much better company that it was six years ago”, she said on a call with analysts. “I think I have added a lot of value here in terms of shareholder value creation . . . The next leader needs to be a deeper technologist.”
“We’ve done a remarkable thing for shareholders,” Ms Whitman said in an interview on Tuesday. Asked whether it may have been better for HPE to have appointed a technologist earlier, she responded: “I’m a consumer tech gal . . . I believe with hindsight I was the right person to take on the challenges.”
Ms Whitman is due to hand over in February to Antonio Neri, HPE’s president, and return to being a non-executive director, the role she held before a crisis at HP propelled her into the CEO’s chair.
According to the company’s calculations, the former HP businesses have returned a total of 89 per cent to shareholders since the split with HP Inc in 2015, and around 200 per cent since the day before Ms Whitman laid out a five-year turnround plan to investors in 2012.
The series of restructurings since Ms Whitman took over has been less positive for workers, with more than 100,000 people losing their jobs. HPE’s latest restructuring plan, designed to simplify its operations and take account of the fact that it has become a far smaller company, will lead to further reductions, though Ms Whitman said job cuts would not account for the most significant part of the cost savings.