In what she presumably hoped would be a pep talk to bolster investor confidence, Whitman told analysts at a San Francisco gathering that the troubled company is making progress with new products, streamlining its operations and getting its costs under control. But she warned that her efforts are being hindered by "a worsening macroeconomic environment," particularly in Europe and China, and repeated her previous prediction that it could take four to five years to turn the corporation around.
"It's going to take longer to right this ship than anyone would like," said Whitman, who was named CEO a year ago. Noting that the Palo Alto company has been beset by numerous problems -- many caused by its frequent shifts in leadership -- she added, "I believe all of this is fixable, but it's going to take some time."
HP's Chief Financial Officer Cathie Lesjak added that the company's next 12 months are "going to be another challenging year," projecting its 2013 fiscal year earnings at $2.10 to $2.30 cents per share.
That didn't sit well with Wall Street, where analysts surveyed by Thomson Reuters generally had expected earnings per share of $3.09. Shortly after Whitman began her presentation, the company's stock price began slipping and eventually closed at $14.91, a drop of $2.22 or nearly 13 percent. HP's shares haven't been that low since 2002.
HP's presentation drew mixed reviews from industry experts.
In general, "they did an excellent job," said analyst Rob Enderle, adding that he was particularly impressed by the company's new emphasis on more clearly quantifying how well its business units are doing.
"It's a good sign," he said. "They are cleaning the windshield, which makes it easier for them to stay on the road. It gives them a view of what's going on."
But while tech specialist Patrick Moorhead credited HP for providing "a very candid and honest evaluation of the company today," he said it needs to better detail how it intends to succeed in some markets, such as smartphones and tablets. He added, "they will need to do this for Wall Street to view them as a growth company."
Trip Chowdhry, an analyst with Global Equities Research, was especially disappointed in HP's earnings projections for next fiscal year.
"We should have expected something better," he said. "The current management team has been in place for a year. There is hardly anything to get excited about."
Many investors have cooled on HP as its sales have flattened, its profit has slumped and its debt has ballooned to $30.6 billion, prompting it recently to announce it is eliminating 29,000 jobs over the next couple of years.
Analysts have criticized the company for entering too many business niches. It sells everything from networking switches, routers and data storage devices to calculators, software and printers. On Wednesday, Whitman said it plans to trim its product lines to make them more efficient.
She and other HP executives also said the company is coming out soon with an array of new servers, printers and personal computing devices that will make it more competitive.
Another source of analyst criticism is that HP has failed to adequately address the increasing pressure its PC business faces from smartphones and tablets. HP previously had no luck selling smartphones and a tablet based on technology it obtained from its 2010 purchase of Sunnyvale-based Palm.
Nonetheless, HP is again developing a smartphone, and on Monday the company introduced a tablet aimed at business and government customers.
Some analysts contend the corporation is so far behind other smartphone and tablet makers that it should get rid of its PC and printer division. Whitman disagreed with that assessment on Wednesday. Insisting that HP is headed in the right direction, she told the analysts, "we have a real handle on what the challenges are in front of this company and we have a plan in place to take on those challenges.
"I believe with every single bone in my body that if we do this right we can set up HP to be a world-class technology leader" well into the future, she added.
Contact Steve Johnson at firstname.lastname@example.org or 408-920-5043. Follow him at Twitter.com/steveatmercnews