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H-P Enterprise Group Executive V.P. David Donatelli talks about the company’s new servers.
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HP skyrocketing today following better than expected earnings after the bell yesterday even though HP beat on earnings revenue did fall in all.
Of its main business divisions if.
And the one bright spot the company's enterprise groups networking division actually saw -- revenue increased by 6%.
So will the enterprise groups.
New server technology help HP pull ahead of the competition.
Joining us now is David Donna -- HP enterprise group's executive vice president David first of -- congratulations on the market -- it was today.
It's a good day happy Friday he with a 12% gain in the market share.
But -- I just -- -- focus go directly into a product that is fascinating to a lot of people your new server it's it's all oriented under the name.
Project moon shot which sounds frankly like -- James Bond novel.
But you take a server that is.
Is what about 10%.
Of the size of normal sure server operates much faster.
-- much lower energy and I think you've got to sample you can show us tell us about it if we can take down that those details actually see the server itself.
-- that's correct.
David -- HP -- led the market for air for industry standard servers now for more than fifteen years and those are built on large scale Intel chips.
Our new server called moon shot is built on the same chips that you have a Smart counts these other Intel atom chips -- -- -- In where this really helps is it really moves servers Ford to help enable all the social media sites in the big web sites and every likes to use every day.
So my hand here are four servers.
This compares to this rack that you see up industry standard servers.
In the power of computing here is I can do in one rack of moon shot.
What it takes ten racks a traditional indices standard servers to do so well these that's -- necessary.
We have prototypes out with our customers today -- In the end is starting in April our second generation this product will be -- being general availability.
Now it is it helping the bottom I know you're you're networking division has done very well you had an increase of what 46% in networking division.
But the -- -- -- server the store and server division correct me if I'm wrong hasn't done is well why not.
What we're seeing here is a big transition in the marketplace.
So in storage is an example we are moving to HP based IP any products we develop ourselves.
For what we call the new world of convergence which is where enterprise infrastructure is having.
So for instance there are product called three par -- you see right over my shoulder here that grew more than 21% year over year.
-- and our new technologies that we're introducing we're seeing great rapid growth.
That is being challenged by some decline in traditional products like -- -- -- -- -- -- for focusing on the negative but like what what what are you having trouble with right now David.
I traditional products like tape you know -- people -- back up to take vs rotating media.
And now of course people -- -- primary storage like disk in solid state needed to be back ups.
So I know a lot of folks are looking at your stock today they're looking at the moon shot and that they get there is a -- at best performer in the Dow so far this year the stock up 14%.
But David.
On a year over year basis -- still down 35%.
IR RUN no recovery are we gonna see this big turnaround from Hewlett-Packard that everybody's wanting.
But we.
I believe you will see the turnaround from Hewlett-Packard.
What we set for fiscal thirteen was really -- and rebuild year.
-- we're happy today that you know we beat earnings rather significantly.
Our cash flow increase over 400%.
But most importantly products are where are gonna lead our come back -- we reducing Q1 new products in printing.
New products and PCs and in tablets in a whole host of new enterprise products wanna which is moon shot that we spoke about.
In this is straight to those products in the service is -- go with them.
That are really gonna drive the recovery of our our revenue growth going forward David why not break up the company I know let's had a dirty word around -- -- but but really focus in May be the moon shot is what does it.
I'm sure that the PC market is not the strongest part of of HP right now what why not actually break up get rid of those units.
That are and are performing well.
Because what our customers continuously tell -- -- they want an end to end solution in HP's one of the few companies in the world -- can deliver that.
As the world converge -- meaning that you use your mobile device to connect to some of these products -- -- here.
It's really an advantage building engineer this -- and it's an advantage have a supply chain from -- and and I can tell you just this week we had our 2000 top resellers in Las Vegas at our annual global partner conference.
Into a person and they all said that they wanna sell an end -- solution from HP they do not wanna see the company broken up.
And those partners account from -- the two thirds of our revenue.
So we have our partners and our customers telling us they want the -- and from eight.
RA David down Italian -- Packard congrats on the -- yet and good luck at -- I hope that serve up again -- just -- what I wanna focus on its 89%.
Less power and 94%.
Less physical space.
Then the other servers this really is a remarkable breakthrough David thanks a lot sexy smaller than your -- thank you very much it is smaller than a paper bag yeah.
