HP 2014 Annual Report Download - page 79

HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
Management’s Discussion and Analysis of
Financial Condition and Results of Operations (Continued)
Corporate Investments
For the fiscal years ended October 31
2014 2013 2012
Dollars in millions
Net revenue $ 302 $ 24 $ 58
Loss from operations .................................... $(199) $(316) $(233)
Loss from operations as a % of net revenue(1) .................. (66.0)% NM NM
(1) ‘‘NM’’ represents not meaningful.
Fiscal 2014 compared with Fiscal 2013
The revenue increase for fiscal 2014 was due primarily to the sale of IP related to the Palm
acquisition.
The decrease in the loss from operations for fiscal 2014 was due primarily to the sale of IP, the
benefits of which were partially offset by higher expenses associated with cloud-related incubation
activities, corporate strategy, HP Labs and global alliances.
Fiscal 2013 compared with Fiscal 2012
In fiscal 2013, Corporate Investments net revenue was primarily related to licensing revenue from
HP Labs. Net revenue decreased from fiscal 2012 due primarily to lower residual activity from the
webOS device business and lower revenue from business intelligence products.
Costs and expenses in Corporate Investments are due to activities in the segment from residual
activity related to the webOS device business, HP Labs, certain incubation projects, corporate strategy,
and global alliances.
LIQUIDITY AND CAPITAL RESOURCES
We use cash generated by operations as our primary source of liquidity. We believe that internally
generated cash flows are generally sufficient to support our operating businesses, capital expenditures,
restructuring activities, maturing debt, income tax payments and the payment of stockholder dividends,
in addition to investments and share repurchases. We are able to supplement this short-term liquidity,
if necessary, with broad access to capital markets and credit facilities made available by various
domestic and foreign financial institutions. Our access to capital markets may be constrained and our
cost of borrowing may increase under certain business, market and economic conditions; however, our
access to a variety of funding sources to meet our liquidity needs is designed to facilitate continued
access to capital resources under all such conditions. Our liquidity is subject to various risks including
the risks identified in the section entitled ‘‘Risk Factors’’ in Item 1A and market risks identified in the
section entitled ‘‘Quantitative and Qualitative Disclosures about Market Risk’’ in Item 7A, which is
incorporated herein by reference.
Our cash balances are held in numerous locations throughout the world, with substantially all of
those amounts held outside of the U.S. We utilize a variety of planning and financing strategies in an
effort to ensure that our worldwide cash is available when and where it is needed. Our cash position
remains strong, and we expect that our cash balances, anticipated cash flow generated from operations
and access to capital markets will be sufficient to cover our expected near-term cash outlays.
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