At market opening today, HP took a big hit, with shares (NYSE:HPQ) trading at $11.65, 12.41 percent below yesterday’s level. The company announced disappointing earnings before market opening. As analysts expected a $2.2 billion net profit, the $8.8 billion loss came as a very bad last-minute surprise. HP blames accounting frauds preceding HP’s acquisition of Autonomy.
Shares closed at 13.30 yesterday. Yesterday morning, Forbes reported that HP was trading near its 2001 low, evaluating the possibility of having hit a low, with the worst behind. All of this was before the earnings.
When it comes to Autonomy, the company claims to be the victim of accounting lies. HP cites “serious accounting improprieties, disclosure failures and outright misrepresentations.” It reported the issue to the FTC as most of the value of the company has evaporated in a few months. Deloitte failed to alert HP about Autonomy’s financials.
Ex-Autonomy management seems to reject the accusation and blames HP. The FTC will decide who is right in that case.
During the earnings call, HP CEO Meg Whitman said that HP’s recovery is a “multi-year journey” and that the company is committed to new products.