November 22, 2010, 8:46 PM — Speaking publicly for the first time since he was appointed CEO of Hewlett-Packard in late September, Leo Apotheker on Monday said that HP will focus more on software and that he still has some learning to do about the company.
Apotheker spoke during a brief conference call with journalists to discuss the company's quarterly earnings report, where HP reported fourth-quarter net revenue of $33.3 billion, up 8% from the same quarter last year. Net earnings for the quarter were $2.5 billion, up 5% over the same period in 2009.
HP has explained Apotheker's silence over the past month by saying that he was on a tour visiting HP employees and customers. That tour appears to have kept him away from California, where he could have otherwise been subpoenaed by Oracle to appear in court. Oracle has charged SAP with stealing software during a time when Apotheker was CEO of SAP.
During the conference call, Apotheker said that he'd been meeting with employees and customers around the world "from California to Massachusetts and Germany to Singapore with many stops in between."
When one reporter asked where he was, Apotheker noted that was an odd question but answered that he was in Palo Alto, California, at HP's headquarters. "Would you like a picture?" he quipped.
Apotheker said he is excited about HP's prospects but he has more work to do to learn about the company. "My top priority is to immerse myself deeper in the business," he said.
One area of growth he has already identified for HP is in software, which currently represents 3% of revenue for the company, he said. "But I think we can do a lot better," he said. "We feel that with software we can add a lot of value and strength to what we can do for our customers." HP would like to double or even triple the share of software revenue it brings in, he said.
It has options for growing its software business, including internal investments and acquisitions, he said.
In the fourth quarter, software revenue grew 1% year over year to $974 million, HP said.
Despite the emphasis on software, HP executives spent little time discussing WebOS, the mobile operating system it acquired along with Palm. HP continues to invest in WebOS, said Cathie Lesjak, HP's chief financial officer.
HP is also continuing to invest in ways to boost its services revenue, but that hasn't paid off just yet. Services revenue increased just 0.4% to $9 billion for the quarter, it said. The business has been growing roughly in line with the market, and the company expects that with its investments and new offerings, its services business should grow at or above the market in the long term, she said.