RealTime IT News

HP Hires Firm to Lead CEO Search

A week after forcing CEO Carly Fiorina to resign, HP said today it has hired New York-based Russell Reynolds Associates to head the search for her replacement. HP did not announce a timetable to hire a new leader.

Fiorina quit Feb. 9 following weeks of rumors that she and the board of directors were at odds over how to govern the company. CFO Robert P. Wayman was named interim CEO.

Fiorina's departure created a flurry of speculation about her replacement. Possible names in the mix include former HP president Michael Capellas, who currently heads MCI; Ann Livermore, a long-time HP executive who was in the running for the CEO spot with Fiorina after Lew Platt left HP in the summer of 1999; and Vyomesh Joshi (VJ), executive vice president of HP's newly formed imaging and personal systems group.

HP said in the immediate aftermath of the executive turnover, that both internal and external candidates would be considered but has maintained a veil of silence over the process.

"As we expect this search to be managed with the highest level of confidentiality, we will not comment further until we are ready to announce our new CEO," Patricia C. Dunn, HP's non-executive chairman of the board, said in a statement.

The search for Fiorina's replacement comes even after a positive quarterly report. HP's earnings of 37 cents a share reported Wednesday topped estimates by 3 cents, and revenues rose to $21.45 billion, beating estimates by $500 million.

The company sees April quarter revenues of $21.2 billion to $21.6 billion, above $21.2 billion forecasts, and earnings of 35 cents to 37 cents a share, in line with 26-cent estimates. If there was a weakness in the report, it was that gross margins fell both quarter-over-quarter and year-over-year due to weaker-than-expected printer sales.

"While we continue to make progress in growing our top line, there is work to be done to improve our profitability," Wayman said in a statement. "As the board conducts a CEO search, our management team is focused on driving improved execution to serve our customers, strengthen our competitiveness and improve shareholder value."

Fiorina faced more challenges than most CEOs, having to guide HP through a $23 billion merger of computer maker Compaq that culminated in 2002.

Experts say that integration is still affecting HP today, and the company has had several significant restructurings in the last two years. The most recent was a merger of the company's printer and PC businesses.