So far the big news out of Hewlett-Packard’s second quarter earnings call is that the company will lose 9,000 employees in fiscal year 2012, with former Autonomy CEO Mike Lynch among the soon-to-be-departed. His exit was announced less than a year after HP completed its acquisition of Autonomy. Overall the company plans to cut 27,000 jobs over the next few years.
Autonomy saw “a significant decline” in license revenue, HP CEO Meg Whitman told analysts on Wednesday’s earnings call. Bill Veghte, HP’s chief strategy officer who also had headed up HP’s overall enterprise software business, will step in to lead Autonomy, she added.
Lynch, the Autonomy founder and most recently executive vice president for HP’s new information management unit, “will leave HP after a transition period,” according to the HP earnings release.
In response to an analyst’s question, Whitman was quick to claim that there is nothing wrong with Autonomy per se and that the unit will remain a linchpin of HP’s big data efforts going forward. She said:
When Autonomy turned in disappointing results we did a fairly deep drive. It’ s not [because of the product], it’s a terrific product; it’ s not the market, there’s enormous demand; and it’s not the competition. This is a classic entrepreneurial company scaling challenge. I’ve seen this movie before. We need to put in some sales processes, a better interface to HP and our services, server, storage and networking [businesses] and we need a better structure to support a billion-dollar-plus company. The opportunity around big data and analytics is fantastic and can flow across all our businesses.
Overall software revenue — a key HP focus — rose 22 percent year over year including Autonomy.
When news of the Autonomy deal leaked last August, it was immediately controversial. Then-CEO Leo Apotheker talked up his proposed $ 10 billion acquisition at a time when HP had only $ 12 billion in cash. The purchase closed in October.
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