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HP names woman as CEO
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July 19, 1999: 3:06 p.m. ET
Lucent's Carleton Fiorina becomes first woman to head a Dow 30 firm
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NEW YORK (CNNfn) - Hewlett-Packard Co. Monday named Carleton "Carly" S. Fiorina as president and chief executive officer, making her the first woman in history to lead a Dow 30 company.
Fiorina, president of Lucent Technologies' Global Service Provider Business, succeeds Lewis E. Platt, who previously announced his intention to retire.
George Elling, computer analyst at Lehman Brothers, said that at least on paper Fiorina should be able to handle the job.
"She's got the qualifications and the technology background," said Elling. "Only time will tell, but she seems to be the right person."
Wall Street seemed to agree. By mid-afternoon, Hewlett-Packard (HWP) stock rose 2-11/16 while Lucent (LU) shares fell back, down 1-7/8 to 76-9/16.
The move to bring in Fiorina marked a shift for Hewlett-Packard. For the first time the company reached outside its own ranks for a chief executive officer.
Fiorina said in a conference call with analysts Monday that the decision was merely a sign of greater linkage between areas of computing.
"I think my selection is an affirmation of the fact that the computing and communications industries are coming together very rapidly," Fiorina said. "The Internet age implies Internet speed, a different pace and a greater sense of urgency. Clearly we need to reinvigorate things here."
Indeed, unlike HP competitor Compaq (CPQ), which is looking for a new CEO to turn around its company, Fiorina doesn't face any clearly defined major problems as she takes her new post.
"Hewlett-Packard never really was broken. It wasn't like IBM, which was losing all kinds of money in the early '90s," Elling said.
Instead, the company has chugged along, rarely missing earnings estimates and even if it did, not by much.
Still, Wall Street views Hewlett-Packard as very much a staid, old guard company and HP definitely has sought to shake things up.
In March, the company unveiled a restructuring that would split it into two separately traded entities, in the hope of garnering a greater share of the hot Internet market.
The restructuring meant HP's test and measurements business would form one side, with the other concentrating on its more widely known computer and imaging businesses.
Additionally, Fiorina said Monday she will try to move the company's nascent electronic services business forward.
Strong Lucent track record
The 44-year-old Fiorina headed Lucent's largest and fastest-growing division, with more than $20 billion in annual revenue.
Among her other accomplishments at Lucent, Fiorina spearheaded the 1996 initial public offering and subsequent spin-off of Lucent (LU) from AT&T (T), one of the largest and most successful IPOs ever.
By most accounts, Fiorina was an up-and-comer who could have chosen from any number of high tech companies.
She defended her choice of choosing a Silicon Valley stalwart rather than an Internet upstart, saying HP still is an exciting company.
"I am at HP because of who HP is and what HP means and what HP can become in the 21st century," Fiorina told CNNfn.
"This is a great American icon, a great brand. It is a company that I've admired for a very long time. And so the chance to run this kind of business, this particular business at this particular time is why I'm here."
On the flip side, Lucent is losing a talented executive but should be able to bounce back, according to Mary Henry, technology analyst at Goldman Sachs.
"While this will clearly be seen as a loss for Lucent, the company has an embarrassment of riches in its management team and we expect a smooth transition to an eventual realignment," said Henry.
Platt, 58, will remain chairman until Dec. 31. By that time, the company said, its computing and imaging businesses are expected to be independent of its measurement businesses.
When Platt retires, Richard (Dick) A. Hackborn, 60, a former HP executive and a current member of the board, has agreed to become non-executive chairman.
-- from staff and wires reports
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