Double FacePalm: HP Blew Billions on webOS
Hewlett-Packard’s decision to acquire Palm and “double down” on its webOS operating system has so far proven a regrettable and costly mistake. How costly?
HP investors, grab your Mylanta …
HP spent $1.2 billion to buy Palm in 2010. Reporting fourth-quarter earnings Monday, the company said it had been forced to write off a record $3.3 billion, about half of which was “related to the wind down of its webOS device business.”
From HP’s earnings statement:
Non-GAAP earnings and operating profit information excludes after-tax costs of $3.3 billion, or $1.56 per diluted share, related to the wind down of HP’s webOS device business, impairment of goodwill and purchased intangible assets, amortization of purchased intangible assets, restructuring charges and acquisition-related charges.
Update: I originally read that list of items as all connected to webOS, but the related expenses seem to break out like so: $885 million from the “impairment of goodwill and purchased intangible assets” was largely tied to webOS and Palm, and $775 million in one-time charges were related to the wind down.
So $1.66 billion to wind down webOS, the crown jewel of HP’s Palm acquisition. That was $1.2 billion well spent …