Reseller News

HP reports $27m loss in NZ

Revenue falling 10 percent to $736 million

Hewlett-Packard's New Zealand subsidiary has had another year to forget, with revenues falling 10 percent to $736 million and its annual loss ballooning from $10m to $27m.

The world's biggest computer maker merged with EDS, whose Wellington-based subsidiary was the dominant provider of information technology services to the Government, in 2009, but has since suffered a series of setbacks.

The results for the year to October suggest the company has lost more than a quarter of its combined pre-merger workforce of 2900. Its wage bill for the year fell $17.4m to $149.9m.

Hewlett Packard New Zealand would not comment on the results because of "HP disclosure policy".

Fonterra partly unwound its $590m outsourcing deal with the company in 2009, instead hiring Indian company HCL to develop and maintain much of its software. The dairy giant said the era of big all-encompassing outsourcing deals was over.

Telecom last year largely binned a $1 billion outsourcing deal with EDS in 2000 and does the work in-house. It said later the decision had been a big contributor to its cost-cutting drive.

Hewlett-Packard shelved a $60m data centre in Tuakau after it lost out to Kiwi rivals Datacom and Revera as a supplier of outsourced shared infrastructure to the Government.