Tags: US | HP | CEO | Resigns

HP CEO Hurd Resigns After Sexual-Harassment Probe

Friday, 06 Aug 2010 05:26 PM

 

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Hewlett-Packard Co. said CEO Mark Hurd is stepping down following a sexual-harassment probe that found other violations of company standards.

HP said Friday that Hurd decided to leave after the investigation into a sexual-harassment claim made against him and the company by a former HP contractor. The probe concludes that the company's sexual-harassment policy was not violated, but that its standards of business conduct were.

After the announcement, the company's shares dropped more than 8 percent in after-hours trading.

In a statement, Hurd said that during the investigation he "realized there were instances in which I did not live up to the standards and principles of trust, respect and integrity that I have espoused at HP." He added that he believed it would be "difficult to continue as an effective leader at HP."

Hurd and Robert Ryan, HP's lead independent board member, stressed that Hurd's departure has nothing to do with the company's financial health.

Ryan said in a statement that HP's board "deliberated extensively" about whether Hurd should leave his post.

"The board recognizes that this change in leadership is unexpected news for everyone associated with HP, but we have strong leaders driving our businesses, and strong teams of employees driving performance," he said.

Hurd, 53, joined HP in April 2005 as its CEO, president and a board member. He gained the title of board chairman in September 2006. Before coming to HP, he worked as CEO of ATM maker NCR Corp. for two years, and as that company's president for nearly four years before that. He is also a member of News Corp.'s board.

The technology company named Chief Financial Officer Cathie Lesjak as its interim CEO. Lesjak, 51, who has been at HP for 24 years, will continue to act as CFO. HP said a board committee will search for a new CEO, and the company said Lesjak decided not to be considered for the position of permanent CEO.

Also Friday, HP issued preliminary results for its fiscal third quarter, which came in slightly above analyst expectations.

HP said it earned 75 cents per share during the period, compared with 67 cents per share in the same quarter a year ago. When excluding one-time items, the company earned $1.08 per share. Analysts polled by Thomson Reuters expected adjusted earnings of $1.07 per share.

HP said its revenue rose 11 percent from last year to $30.7 billion; analysts were looking for $30 billion in revenue.

HP gave outlook for its fiscal fourth quarter as well. The company forecast earnings of $1.03 to $1.05 per share, or $1.25 to $1.27 per share after excluding one-time items. Analysts were hoping for adjusted earnings of $1.26 per share. HP expects $32.5 billion to $32.7 billion in revenue, in line with analysts' expectations of $32.6 billion.

HP plans to report its final results Aug. 19.

HP shares fell $4, or 8.6 percent, to $45.89 in after-hours trading, having finished regular trading down 5 cents at $46.30.

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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