Hewlett-PackardNEW YORK – Hewlett-Packard Co. on Wednesday said that it will take a massive charge against its earnings for the latest quarter, leading to a record loss of nearly $9 billion.
The charge is the result of a writedown of the value of its services business, reflecting that the company overpaid for when it bought Electronic Data Systems in 2008 for $14 billion.
HP said it will take an $8 billion charge for the reduced value of Enterprise Services in the quarter that ended in July. The division, which provides information technology and outsourcing services to corporations, has seen flat revenue for the last two years, and its operating profit has declined.
The Palo Alto, Calif. company said the charge and other accounting adjustments will lead to a loss of $4.31 to $4.49 per share. That works out to about $8.5 billion to $8.9 billion.
In the last 15 years, HP has only posted one quarterly loss.