HP Storage Slammed

For weeks now, storage vendors have whined that poor results at Hewlett-Packard Co. (NYSE: HPQ) are a drag on earnings. Today, HP CEO Carly Fiorina said HPs storage is bringing down the entire company.

Fiorina blamed the Enterprise Servers and Storage (ESS) division for HP’s woes last quarter, identifying storage as a particular problem (see HP Reports Q3 Earnings).

In a conference call with analysts this morning, Fiorina said solid results in other parts of HP “were overshadowed by unacceptable execution in Enterprise Servers and Storage. We therefore are making immediate management changes. We are also accelerating our margin improvement plans in this business. With these changes, we expect our server and storage business to return to profitability in the fourth quarter.”

The management changes were not storage-specific, as three members of the customer solutions group (CSG) were replaced with executives from inside the company hours after the earnings report. The CSG is HP’s enterprise sales team. Chief marketing officer Mike Winkler replaces Peter Blackmore as CSG Executive VP. Jack Novia, formerly senior VP of HP’s technology solutions group, replaces Jim Milton as CSG SVP for the Americas. Bernard Meric, former SVP of HP’s Europe, Middle East, and Africa (EMEA) printer division, replaces Kasper Rorsted as head of the CSG in EMEA.

Bob Schultz, senior VP of network storage solutions, heads HP's storage team. Ann Livermore was appointed executive VP of HP's Technology Solutions Group last December as part of a reorganization that included storage (see HP Reorg Highlights Storage).