webOS Hardware Division Will Shut Down by Q4 2011by Anand Lal Shimpi on August 18, 2011 5:16 PM EST
On HP's Q3 2011 earnings call it clarified both the reason for the shutdown and the exit timeframe for the webOS hardware division.
HP claimed that webOS hardware didn't meet internal sales goals. Combined with an increasingly competitive marketplace, HP decided that it was in its best interests and the best interests of its shareholders to exit the webOS hardware business. HP will shut down the webOS hardware division by Q4 2011.
If you're wondering why HP also expressed interest in spinning off/selling its Personal Systems Group. The earnings statement speaks for itself:
"Personal Systems Group (PSG) revenue declined 3% year over year with a 5.9% operating margin. PSG remains the PC market leader in terms of units, revenue and profit share. Commercial Client revenue grew 9% and Consumer Client revenue declined 17%.
HP wants to explore areas with higher profit margins (read: enterprise computing). Getting rid of its PC business while it's still doing (relatively) well makes the most sense from a timing perspective.
Source: HP Investor Relations