CRN Exclusive: HP CEO Dion Weisler On Taking Share From Competitors, Why HP Is 'Innovating Like Crazy' And What He Thinks Of President Trump's New Immigration Order

Weisler On A Strong Quarter From HP

HP CEO Dion Weisler spoke with CRN about HP's highest personal systems sales growth since the Windows XP refresh three years ago, the importance of HP's razor sharp focus on innovation, and President Donald Trump's new immigration order.

Weisler spoke with CRN after the company Wednesday posted 10 percent Personal Systems sales growth to $8.22 billion for its first fiscal quarter ended Jan. 31, up from $7.46 billion in the year ago quarter.

Overall, HP posted better than expected results for its first fiscal quarter ended Jan. 31. The $48 billion printing and PC power house posted non GAAP diluted net earnings per share of 38 cents on sales of $12. 68 billion, up four percent from $12.2 billion in the year ago period. The Wall Street consensus was non GAAP diluted earnings per share of 37 cents on sales of $11.84 billion.

"This quarter can best be characterized as relentless execution and innovation that delivered really strong results," said Weisler. "It's the second quarter in a row of growth and solid performance. Innovation is at the heart of driving the meaningful share gains we have had. We are the pillar of stability right now in the industry."

Where is the 10 percent growth in the PC business coming from in terms of share gain?

The growth is really coming fairly broadly from all of our competitors in every market. Every single region had strong double digit growth not only in PCs, but in print as well. I think this is really off the back of the tremendous work that (Personal Systems President) Ron Coughlin and his team have done working together with the channel. He takes a lot of time. He sits there with (HP Americas President) Christoph (Schell) and his organization. They have retail executive forums. They have customer council meetings. They have partner council meetings. These guys are just cranking the innovation engine like I have never seen.

Are there any specific market segments such as the premium market against Apple or gaming where you are seeing share gains?

We did incredibly well in premium. We took share across the board. We have the world's thinnest laptop out there. Thinnest laptop is not a trophy owned anymore by other folks. It was great to take that trophy.

I think we are being seen as design innovators. None of our competitors are living up to that in the same way we are focused on it.

How important is innovation with regard to the growth in the personal systems business?

Innovation is key to differentiation and value. It is the way we like to win. You can't cut your way to glory. You have got to innovate your way to success. I think it is the best PC lineup we have had in decades. We've not only got stunning and functional design but we're really listening to our partners and our customers when they tell us they need the most secure and manageable devices on the planet.

How important is security in the PC and printer market?

In every meeting I have there is talk about cybersecurity. We are building security below the operating system level into the hardware and above the operating system level in many, many areas.

What are some of the keys to posting such strong personal systems results in a tough market?

I think it is just great execution, taking costs out of the system, focusing on design, focusing on adding sprinkles of magic that make a difference to customers, and then you take share from competitors.

How were you able to generate the best PC sales growth you have seen since the Microsoft Windows XP refresh three years ago?

I think what it really demonstrates is the fundamental strength of the business. The XP refresh was industry-wide, but we happened to execute better than all of our competitors there.

With Windows XP, we took advantage of a change that was happening in the market – the XP sunset – and we turned it into our opportunity.

Unlike that event, this performance is not triggered by any single event. It is driven by a lot of hard work across every single segment.

It is about understanding the macro trends – what is happening with the way customers are buying: is it transactional or contractual? How are millennials purchasing – what do they value? what do they not value? – and then embedding that in products and solutions across the portfolio. So it becomes systemic. It is foundational as opposed to event-driven. That is the major difference.

How big a differentiator is HP's channel commitment versus the competition?

Our partners really, really trust us. They have been with us in many cases for decades. We have never flip-flopped on them. We have always said we are a "partner first" company. We put our money where our mouth is. Last year, we said we were going to move from 80 percent with and through the channel to 87 percent with and through the channel. We did that. They think about HP as the place to go to get incredible innovation. We continue to invest in them not only in the programs, but in training.

Give an example of some of the training that you are doing to drive partner sales growth .

We introduced Partner Sales Academy in November and we certified 1,600 channel sales people on how to sell services and solutions. It is those sorts of things – continually raising the bar with partners – that makes a difference.

How much revenue growth do you think you can see in Device-as-a-Service this year?

We never guide any particular segment or route to market. What I would tell you is we have incredible interest in growing the sales pipeline for Device-as-a-Service. We obviously have completed some transactions and are supporting customers.

From a pipeline perspective, when we log into our CRM system it is one of the fastest growing pipelines that we have because many customers are looking to go from a transactional motion to a contractual motion just as they did for print. We have leveraged everything that we have learned in print [as a managed service] over the last seven to nine years and we are bringing that to bear into the personal systems side of the business.

What is your call to action to partners to continue to grow the business?

My call to action is to continue to have a strong dialogue with their partner managers, management and product category folks. We are an organization that operates with two ears and one mouth and we use it in relative proportion in which it was given to us. I would like to think that we continue to be humble and that we are really listening. But we think we are learning things not only from our partners, but from the ecosystem that we are trying.

How big an opportunity is there in the future for partners?

There is great opportunity out there – not just in Device-as-a-Service. There is an amazing opportunity in print. We have the whole A3 [copier replacement printer] side of the market – a $65 billion market – that we have less than four percent market share relative to the sometimes 60 percent market share we have in regular A4 printing. That is a huge call to action for our partners: Get on board with a company that is innovating like crazy, that is prepared to listen, prepared to work and prepared to invest in you.

What is your reaction to President Donald Trump's new immigration order?

What we are really grounded in are our values. We are a company that values diversity – deeply values it. We believe that diversity and inclusion are some of the core values that help deliver on our vision to make life better for everyone – everywhere. We are not going to be deterred from that value proposition.

We obviously will work with the new administration. This is not the first administration we are going to work with. We have been around for 77 years – that is about 12 U.S. administrations. We operate in 170 countries. Do the rough math on that – it is approximately 2,400 administration changes that we have seen. It is early days. We are not going to compromise our values, but we do intend to work with all new administrations around the world.