8 December 2004 Computer giant Hewlett-Packard has revealed that it has considered splitting its business, amid pressure to do so, but will continue to resist calls to break up.

At the company’s analyst meeting in Boston, Massachusetts this week, Carly Fiorina, CEO of HP, admitted that the management board had held talks about a possible breakup on at least three occasions, but each time unanimously decided to keep the company together.

In June 2004, Merrill Lynch analyst Steven Milunovich published a report calling for HP to be broken up. Shareholders would receive best value for money it HP concentrated solely on its lucrative printing and imaging business, he said.

HP’s printing unit accounted for 30% of its 2004 sales but more importantly 80% of profit.

Alternatively, said Milunovich, HP should consider splitting the company into a consumer division and a corporate division.

But Fiorina is adamant that HP is better kept as a single entity. “Fundamentally, we have completed this picture. We are now at the point where we have the right strategy, the right portfolio of products and we’re in the right markets,” she said.

Questions over its composition look set to hang over HP, at least in the short to medium term. HP has yet to produce the financial performance it predicted prior to its mammoth acquisition of rival Compaq. Adding to this pressure, rivals such as IBM, appear more willing to sell off less profitable business units. IBM has just completed the sale of its PC unit to rival Levono.