HP Inc. Shares Soar 13 Percent; HP CFO Lesjak: 'It Feels Great'

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Shares of HP Inc., the new $55 billion PC and printing business born as a result of Hewlett Packard splitting in two, soared 13 percent under the original HPQ ticker symbol on its first day of trading on the NYSE.

"It's great news," said HP Inc. CFO Cathie Lesjak in an exclusive interview with CRN -- in the original offices of Hewlett-Packard founders Bill Hewlett and Dave Packard in Palo Alto, Calif. "They are voting with us. It feels great. What I think it says is there is a lot of opportunity for success at HPI. We couldn't be more excited about it."

Shares of HP Inc. closed up $1.59, at $13.83, on Monday.

[Related: Hewlett Packard Enterprise CEO Whitman To Ring The NYSE Bell, Ingram Micro CEO To Join Her]

Shares of Hewlett Packard Enterprise, the $53 billion enterprise system, software and services company that launched under the HPE ticker symbol, were down 23 cents per share, or 2 percent, to $14.49.

Lesjak attributed the HP Inc. growth in part to a strong near-term, midterm and long-term strategy laid out by CEO Dion Weisler and the executive team for the HP Inc. launch.

"I think we have laid out a really good strategy, where we have got things we need to do in the core in the near term," she said. "Then we have got growth opportunities in the midterm, and that is really about commercial mobility, packaging and graphics, and the [printer] copier [replacement] market. And then you have the long-term future, which is all about blended reality, 3-D printing and immersive computing. We are pretty excited about it."

Lesjak reiterated HP Inc.'s commitment to return about 50 percent to 75 percent of free cash flow to shareholders.

In 2016, it will be at the high end of that, and shareholders obviously like that as well, said Lesjak. "We are a cash-flow business, so it makes sense to return cash to shareholders and take some of that also and plow it back into the business," she said.

Lesjak also emphasized how important HP Inc.'s channel partners are to the company's future, with more than 80 percent of sales going through partners.

"We can't do it without partners," she said. "That is the reason why today on the big launch day, we have invited all of these partners to come and celebrate with us. At the core, we also depend on partners. Eighty-plus percent of our business comes from partners."

Joe Hemani, founder and sole owner of Westcoast, a $3 billion United Kingdom HP Inc. value-added distributor, said he expects his HP Inc. business to be up 35 percent next year on top of 20 percent this year." I see more opportunity, more revenue, more profits," he said.

"What comes with HP separating is agility," he said. "In a fast-growing market, you need agility. You need to be able to make quick decisions. You need to get to the market quicker. Your supply chain has to be shorter and your customer satisfaction levels have to remain the same."

Gustavo Moller-Hergt, CEO of ALSO, a $7.5 billion German distributor, said he is "more than optimistic" about HP Inc. and Hewlett Packard Enterprise.

Moller-Hergt said he has seen HP Inc. moving faster even before the formal split with much more rapid price quoting.

Jos Brenkel, who is heading up sales operations for the new HP Inc., said the high level of attendance and engagement of the 60-plus partners at the formal HP Inc. headquarters launch party is unprecedented.

"It really feels like we are creating a new opportunity for our partners, employees and customers," said Brenkel. "It feels like when I first joined HP 29 years ago."

PUBLISHED NOV. 2, 2015