HP 2008 Annual Report Download - page 2
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Fiscal 2008 was a strong year with some notable
accomplishments. We have prepared HP to perform
well and are building a company that can deliver
meaningful value to our customers and stockholders
for the long term. Looking ahead, it is important to
separate 2008 from 2009, and acknowledge the
difficult economic landscape. While we have made
much progress, there is still much work to do.
2008—Solid Progress and Performance in a Tough
Environment
With the acquisition of Electronic Data Systems
Corporation (EDS), we continued implementing a
multi-year strategy to create the world’s leading
technology company. Additionally, we made solid
progress on a number of core initiatives, including
the substantial completion of phase one of HP’s
information technology transformation.
Fiscal 2008 was also a difficult year, during which
economic conditions deteriorated. HP proved our
ability to execute in a tough environment.
In 2008, HP delivered:
• Net revenue growth of 13 percent, or 8 percent in
constant currency, to $118.4 billion
• GAAP operating profit of $10.5 billion
• GAAP diluted EPS of $3.25, up from $2.68 in the
prior year
• Non-GAAP operating profit of $11.8 billion*
• Non-GAAP diluted EPS of $3.62, up from $2.93
in the prior year*
HP gained share in key segments, while continuing
to show discipline in our pricing and promotions.
Software, services, notebooks, blades and storage
each posted double-digit revenue growth,
highlighting both our market-leading technology and
improved execution. Technology Services showed
particular strength with double-digit growth in
revenue for the year and improved profitability.
The EDS Acquisition—Disciplined Execution of a
Multi-year Strategy
In August, HP completed its acquisition of EDS, a
global technology services, outsourcing and
consulting leader, for a purchase price of $13
billion. The EDS integration is at or ahead of the
operational plans we announced in September, and
customer response to the acquisition remains very
positive.
The addition of EDS further expands HP’s
comprehensive, strategically assembled portfolio that
provides unparalleled capabilities for delivering end-
to-end solutions. Over the course of several years,
HP has established a track record of making
acquisitions, integrating them, supporting them with
R&D and turning them into market leaders with
enhanced profitability. HP is following the same
game plan with EDS, which is an excellent fit both
financially and operationally. EDS provides a strong
base of recurring revenues and a meaningful
opportunity to capture synergies and expand
earnings per share. More importantly, EDS adds a
Dear Fellow Stockholders,
CEO letter