Enterprise, Mergers and Acquisitions

HPE CEO Meg Whitman: We’re NOT Getting Out Of Software

Hewlett Packard Enterprise (HPE) CEO Meg Whitman has entered the blogosphere -- with a blog describing why HPE is spinning off "non-core" software assets. She also makes it clear: HPE isn't getting out of the software business. Instead, she makes bold promises that HPE will be a key player in the software-defined era.

Here's the blog in its entirety:

It's been quite a year for HPE. While we only launched our new company last November, it's amazing how much progress we’ve made as a standalone company.

When we launched the new HPE, we laid out a vision of being the industry's leading provider of hybrid IT, built on the secure, next-generation, software-defined infrastructure that will run customers' data centers today, bridge them to multi-cloud environments tomorrow, and enable the emerging intelligent edge that will power campus, branch and IoT applications for decades to come.

We believe this is what our customers are looking for, what we are best qualified to do and what will be the most successful path forward.


To achieve this vision, we've been busy realigning our portfolio and product roadmap with our go-forward strategy.

In just the last few months, we announced enhancements and new products across storage, infrastructure, converged systems, cloud and a truly differentiated set of edge compute products for the Internet of Things. We also announced plans to acquire SGI, further extending our leadership in high-performance computing, big data analytics and data management.

And I'm excited to go to market with our new strategic partners, including GE Digital, Docker and Mesosphere.


Through this process, we also identified areas of the business that were not aligned with our go-forward strategy. Over the last year, we made a number of bold moves to focus our portfolio, including the sale of TippingPoint, the H3C deal in China, and of course, the spin-merge of our Enterprise Services business with CSC.

And today we announced plans for the spin-merge of our non-core software assets with Micro Focus. The combination of HPE’s Application Delivery Management, Big Data, Enterprise Security, Information Management & Governance and IT Operations Management businesses with Micro Focus will create one of the world’s largest pure-play software companies.

Micro Focus' approach to managing both growing and mature software assets will ensure higher levels of investment in growth areas like big data analytics and security, while maintaining a stable platform for mission-critical software products that customers rely on.

Because of this, I believe that the software assets that will be a part of the combined company will bring better value to our customers, employees and shareholders as part of a more focused software company.


I want to be crystal clear – HPE is not getting out of software. Software is still a key enabler of our go-forward strategy, but we need the right assets to win in our target markets. Moving forward, we will double down on the software capabilities that power and differentiate our infrastructure solutions and are critical in a cloud environment.

For example, our newly created Software-Defined and Cloud business will build upon key software assets like OneView and the Helion Cloud platform to deliver software-defined hybrid IT solutions like Synergy, the industry’s first composable infrastructure, and our other hyper-converged systems. Since OneView’s launch in 2013, we’ve sold nearly 500,000 licenses and have a growing partner ecosystem, including Docker, Chef, Turbonomic and SaltStack.


I am confident that we are making the right choices. Once the ES–CSC and Software–Micro Focus transactions are complete, HPE will be a faster-growing, higher-margin and stronger free cash flow company, well positioned for the future.

While there is more work to do, we are already seeing that our strategy is working. We’ve recently secured new customers like Home Depot, Best Buy, Dropbox and the Rio airport, and we continue to introduce best-in-class solutions.

And the market is recognizing what we are doing. With these strategic moves and our continued strong operational performance, HPE's market cap has increased by over $10 billion, or 40%, since the separation from HP Inc. on November 1, 2015.

As I've said many times before, we're living in a world where continuous improvement is essential to long-term success. I am pleased with the progress we've made, and am excited about the opportunity ahead.


Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.