Australian-born Dion Weisler got a big promotion this week, as Hewlett-Packard named him executive vice president for printing and personal systems. He will run vast global businesses that generate about half of HP's $120 billion a year in revenue. So how should he define his priorities?
There's nothing like the chart below to help Weisler stay focused. Everyone knows that HP's older notebook and personal-computer businesses are shrinking, while newer mobile offerings are just starting to spring to life. Right now, however, this is not shaping up to be a happy hand-off. If recent trend lines continue, the old operations will fade away long before mobile fully gets its act together.
During the quarter ended April 30, HP reported, its notebook revenue fell 24% from the prior year. Desktop PC sales slid 19%. The small bright spot: revenue from "other" devices (primarily tablets and other mobility gear) rose 17% from a modest base.
Stretch out those trends, and HP's mobile offerings won't match desktop PCs' current $3 billion a quarter of revenue until 2029. Mobile won't even become a $1 billion-a-quarter business for another nine years. That leaves HP far behind mobility leaders such as Apple and Samsung for an embarrassingly long time.
By 2019 or so, HP's mobile devices might out-sell the company's desktop PCs and notebooks, at about $750 million a quarter. But that crossover point wouldn't provide much basis for celebration. The switchover would be driven mostly by the older products' diminishing sales, rather than the newcomers' rapid growth.
The assumptions behind this chart could prove overly harsh. HP's PC and notebook businesses might have far greater staying power than the latest quarter's revenue slump would suggest. What's more, on the mobile side, HP has lots of ambitious projects in the works, all aimed at faster-than-17% revenue growth.
HP's departing head of printing and personal systems, Todd Bradley, described some new initiatives to me in an interview in April. And while Bradley probably won't get full credit for whatever eventual successes they achieve, he may have handed his successor a perkier mobile portfolio than the graph above suggests. HP's chief executive, Meg Whitman, tried to say as much Wednesday, in announcing Weisler's promotion. "Todd has left Dion a great legacy to build on," she said in a statement.
So it's hard to know with certainty when HP's mobile revenue will overtake its older counterparts, or at what dollar level that passing of the baton will occur. But it's a safe bet that Whitman and HP's board won't be satisfied if Weisler's businesses simply plod along at current rates. Success, for him, will mean getting HP's mobile strategy on track, in ways that create a much happier crossover point.
Make the green line take off like a rocket. Shore up the orange and red lines as much as possible. For Dion Weisler, there's nothing murky about the task ahead.
