In a dramatic strategy shift that left investors shaken, HP announced Thursday (Aug. 18) it is considering a spinoff of its PC business to focus on business software.
The world's largest PC maker announced at the same time it will acquire the British software company Autonomy.
HP said it will discontinue its webOS phones and new TouchPad tablet, which has been available for just a few weeks. The products have not met internal milestones or financial targets, the company said.
A spinoff of the PC business would amount to a reversal of HP's acquisition nine years ago of Compaq.
"HP is implementing a plan to fundamentally transform the company," the firm said in a statement.
The move was seen as an acknowledgement of the decreasing relevance of PCs as consumer preferences shift to mobile devices.
"It's Day 1 of the transformation," CEO Leo Apotheker, who joined HP last September, told the Wall Street Journal, acknowledging "difficult decisions" that had to be made in a search for better performance.