Intel: change of guard
Otellini’s successor to come into a hard landing
The Paul Otellini era at Intel Corp is drawing to a close. Intel’s legendary CEO will call it a day in May 2013, after working for an astounding 40 years in the service of the world’s largest chip maker. The news came as a shocker, as Otellini, 62, surprised the tech community by announcing to retire three years before Intel’s mandatory retirement age. He has had a stellar record at the helm of Intel since 2005. Intel’s revenue increased by 57% to reach $55 billion at the end of 2011. He also settled an antitrust suit against Intel for $1.25 billion, and went on to convince Apple to put Intel chips in its computers.
Otellini will hand over the baton to a new incumbent at a critical juncture in the company’s 44-year-old history. Until not very long ago Intel strode the tech world like a collossus, enjoying over 80% share of the global market in computer chips and processors. But those days of glory are now a fading memory as new rivals and upstarts such as Qualcomm and ARM Holdings have eaten into the turf that was once Intel’s happy hunting ground. The company also found itself turning up late for the party as new players made rapid gains by moving in fast and capitalising on the big shift towards mobile devices.
The Intel board has begun its search in earnest for a worthy successor who can turn around the flagging fortunes of a company beset by an eroding market share and falling PC sales. Last month Intel’s Q3 net income fell by more than 14% to $3 billion on falling PC sales (its core competence area). According to market research firm Gartner, PC sales fell flat for the seventh quarter in a row during the second half of 2012 and the outlook for the future doen’t look bright either. Will Otellini’s successor be able to step up to the plate and revive Intel’s business in these challenging times?
HP: DEAL gone sour
Autonomy deal blows up in the face
Bad luck seems to have become a constant companion of the US technology major Hewlett-Packard (HP). The latest downer is it’s purchase of Autonomy, a British software company, for a whopping $11 billion last year. How HP, an old warhorse of the tech race, could have been so naive to jump at a deal, which had disaster written all over it from the word go? Autonomy’s numbers were fishy to begin with. Its stated profit margins of around 50% did not seem to translate proportionately into cash flow and its claim of double-digit organic growth in software license revenue appeared too good to be true. And despite being warned by analysts that it was forking out too high a price for the acquisition, the computer maker went ahead with the deal. Not surprising that it has now unravelled with destructive force leaving behind a toxic trail of accounting rigmarole. HP is now engaged in salvaging the situation and limiting its damages. The company has written down $8.8bn in the value of the deal. It has also fessed up to “serious” accounting improprieties at the British company. However, it will take some time before HP is able to clean up the mess and leave the stink behind.
Otellini’s successor to come into a hard landing
The Paul Otellini era at Intel Corp is drawing to a close. Intel’s legendary CEO will call it a day in May 2013, after working for an astounding 40 years in the service of the world’s largest chip maker. The news came as a shocker, as Otellini, 62, surprised the tech community by announcing to retire three years before Intel’s mandatory retirement age. He has had a stellar record at the helm of Intel since 2005. Intel’s revenue increased by 57% to reach $55 billion at the end of 2011. He also settled an antitrust suit against Intel for $1.25 billion, and went on to convince Apple to put Intel chips in its computers.
Otellini will hand over the baton to a new incumbent at a critical juncture in the company’s 44-year-old history. Until not very long ago Intel strode the tech world like a collossus, enjoying over 80% share of the global market in computer chips and processors. But those days of glory are now a fading memory as new rivals and upstarts such as Qualcomm and ARM Holdings have eaten into the turf that was once Intel’s happy hunting ground. The company also found itself turning up late for the party as new players made rapid gains by moving in fast and capitalising on the big shift towards mobile devices.
The Intel board has begun its search in earnest for a worthy successor who can turn around the flagging fortunes of a company beset by an eroding market share and falling PC sales. Last month Intel’s Q3 net income fell by more than 14% to $3 billion on falling PC sales (its core competence area). According to market research firm Gartner, PC sales fell flat for the seventh quarter in a row during the second half of 2012 and the outlook for the future doen’t look bright either. Will Otellini’s successor be able to step up to the plate and revive Intel’s business in these challenging times?
HP: DEAL gone sour
Autonomy deal blows up in the face
Bad luck seems to have become a constant companion of the US technology major Hewlett-Packard (HP). The latest downer is it’s purchase of Autonomy, a British software company, for a whopping $11 billion last year. How HP, an old warhorse of the tech race, could have been so naive to jump at a deal, which had disaster written all over it from the word go? Autonomy’s numbers were fishy to begin with. Its stated profit margins of around 50% did not seem to translate proportionately into cash flow and its claim of double-digit organic growth in software license revenue appeared too good to be true. And despite being warned by analysts that it was forking out too high a price for the acquisition, the computer maker went ahead with the deal. Not surprising that it has now unravelled with destructive force leaving behind a toxic trail of accounting rigmarole. HP is now engaged in salvaging the situation and limiting its damages. The company has written down $8.8bn in the value of the deal. It has also fessed up to “serious” accounting improprieties at the British company. However, it will take some time before HP is able to clean up the mess and leave the stink behind.
For More IIPM Info, Visit below mentioned IIPM articles
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
| ExecutiveMBA |
