The maker of expensive printer ink, HP has promised to increase spending on research, sales and to turn around its flagging services arm after its fourth-quarter profit fell nearly 91 percent on weak computer sales.
HP gave a modest earnings forecast for next year saying that 2012, will be a "reset and rebuilding year." The results were better than expected after the pants year that HP has had, but executives said its turnaround effort will entail major investments in research and development and in expanding personnel and internal systems.
CEO Meg Whitman also warned of challenges to growth from a worsening external environment, including falling demand from Europe. Flooding in Thailand has choked off the supply of hard drives, driving up prices for components, she said.
Whitman said in an interview with Reuters that HP had to improve execution, we guess staff are not dying fast enough. She said that the next two quarters were going to be hell on toast for the IT industry anyway.