Hewlett-Packard is set to report fourth quarter results after the markets close today, and some company news already has investors jittery.
Specifically, its lack of cash on hand--it spent $11.7 to buy software company Autonomy last month and took a $1 billion charge when it dumped its tablet-computer business--has popped up as the worry du jour for the company, which in September named Meg Whitman CEO, making Leo Apotheker its seventh ex-CEO since 1999.
HP had only $13 billion on hand at t he end of the third quarter, reports The Wall Street Journal, and the concern isn't that HP will go broke, but that it will be unable to make further acquisitions or buy back stock. In addition to Autonomy, HP has recently acquired ArcSight Inc., 3PAR Inc., Palm Inc. and 3Com Corp., all in deals valued at over $1 billion.
"We are also focused on rebuilding our balance sheet, improving our financial flexibility and taking a balanced and disciplined approach to capital allocation," Whitman said when she took the job.
Still, said analysts, the company's balance sheet is relatively strong, despite the $25 billion it had at the end of July.
Today, HP is expected to announce it has continued its trend of the past few years, generating less free cash flow.
The company in August said it expects $8 billion for the year, a steady decline from $8.4 billion in 2010, $10.2 billion in 2009 and $12 billion in 2008.