SAN JOSE, Calif — Hewlett-Packard Co. on Wednesday confirmed plans for a corporate overhaul that will combine two of its biggest divisions, printing and PCs, in an effort by new CEO Meg Whitman to turn the troubled tech giant around.
Under the reorganization, which represents some of the biggest changes at HP in years, Whitman is also consolidating global sales, marketing and communications functions that had been spread across different business units.
The result will be a faster, more streamlined, performance-driven HP, Whitman said in a statement.
The announcement does not mention any cutbacks or layoffs, although industry experts have said that some cuts are likely as Whitman follows through on a promise to streamline HPs far-flung tech businesses and trim operating costs.
HPs announcement did confirm a significant shake-up in the executive ranks: The combined printing and PC unit will be led by longtime PC chief Todd Bradley, 53, who is credited with helping make HP the worlds No. 1 seller of PCs in recent years. Veteran printing head Vyomesh VJ Joshi, 57, will leave the company.
In addition, HP said its global accounts organization, responsible for selling commercial tech products to big customers around the world, would be added to the responsibilities of David Donatelli, an executive vice president who already oversees the HP division responsible for producing commercial data center hardware.
The biggest changes, however, involve printing and PCs, which have been the powerhouse businesses at HP in past years, but which are no longer the biggest growth engines.
Printing and PCs provided a combined $15 billion in revenue for HP last quarter about half the companys total sales. But both divisions have reported slowing sales, as printing habits have changed and consumers have turned to smartphones and tablets as alternatives to PCs.
HP has considered a number of broad changes for its PC and printing groups in recent years, including former CEO Leo Apothekers controversial proposal last summer to get out of the PC business entirely. That plan was part of a broader strategic effort to emphasize more profitable businesses, including commercial software and cloud computing.
Whitman vetoed the idea of a PC spinoff soon after she replaced Apotheker last fall. But she has said HP will continue to expand its software and commercial tech businesses.
Reaction on Wall Street to the new plan was mixed.
ISI Group analyst Brian Marshall called the plan a positive move that should allow HP to cut some redundant costs and increase its buying power for components and other supplies.
Needham analyst Richard Kugele, however, said he views the restructuring as a worrying sign that the printing division may have deeper problems than HP has previously acknowledged.
Some analysts said the new corporate structure in particular shows the declining prominence of printing at HP once the companys biggest business..
The effect of any cutbacks could not be determined Wednesday. HP has nearly 350,000 employees but it does not provide a breakdown by division.