Cisco boss pledges to play hard ball against rival HP.
Click to enlarge
John Chambers this week warned HP of the mammoth task recently appointed Chief Meg Whitman has in front of her, as she looks to turnaround the PC giant.
“There’s not been a company ever turned around by the fifth CEO on the job,” Cisco CEO John Chambers told Reuters, who also indicated his company was prepared to play hard ball and seize advantage against its market rival.
“Its a tough hand to play, but clearly as a competitor I like competing against that hand, and we are going to try and accelerate while they are struggling,” Chambers added.
Ex-eBay boss Meg Whitman replaced Leo Apotheker mid last year after a tumultuous period, where the PC giant toyed with the idea of dumping its hardware business.
The PC giant recently announced a shocking Q3 profit tumble of 568% with net loss earnings of $8.9 bn.
The stern warning from its rival comes as HP moves ever increasingly into Cisco’s territory of networking and services, with more and more of its profits coming from its software business.
Palo Alto based HP recorded 65% growth in software services in its recent Q3- one of the only divisions recording growth.
The No. 1 PC maker saw revenue in hardware–including desktops & notebooks, and imaging–all slumping in the third qurter.
“HP is still in the early stages of a multi-year turnaround, and we’re making decent progress despite the headwinds,” Whitman said on the massive profit slump in August.
The Hewlett Packard CEO previously admitted the tough task ahead of her, but indicated she is prepared for the long haul ahead.
However, Chambers may have some tough decisions of his own to make.
One securities analyst warned Cisco may need to decide if it is to make new acquisitions in order to enter new markets, like HP and Dell did.
“Does Cisco need to embrace this trend and, for example, buy a NetApp (to diversify into storage?,” said FBN Securities analyst Shebly Seyrafi.
“These are questions they are probably contemplating right now.”