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David Faber Speaks with Meg Whitman on SQUAWK ON THE STREET

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Related: SQUAWK ON THE STREET, CNBC, NBC

CNBC's David Faber spoke with Hewlett-Packard CEO Meg Whitman on Today's SQUAWK ON THE STREET on CNBC. A transcript of the interview follows:

FABER: THANKS VERY MUCH, CARL. OF COURSE, WELL, YOU CAN CERTAINLY GIVE THEM CREDIT PERHAPS FOR TRANSPARENCY, HEWLETT-PACKARD YESTERDAY LAYING OUT A BROAD PLAN FOR REMAKING THE COMPANY OF COURSE PART OF THAT WAS SETTING THE FINANCIAL BAR FAR LOWER FOR NEXT YEAR A YEAR THAT THEY'RE CALLING A FIX AND REBUILD YEAR. AS YOU SAID, THE STOCK TOOK QUITE A HIT ON THAT NEWS. WE ARE JOINED BY THE CEO OF HEWLETT-PACKARD, MEG WHITMAN JOINS US FROM HEADQUARTERS OF THE COMPANY IN PALO ALTO. MEG, AS ALWAYS, VERY MUCH APPRECIATE YOUR WILLINGNESS TO COME ON ESPECIALLY IN WHAT ARE SEEMINGLY VERY DIFFICULT TIMES. YOU AND I SAT DOWN A LITTLE MORE THAN A YEAR AGO WHEN YOU FIRST JOINED THE COMPANY. AND I GUESS MY FIRST QUESTION WOULD SIMPLY BE WHAT TOOK YOU SO LONG? A YEAR IS QUITE A WHILE IN THE HISTORY OF A COMPANY, CERTAINLY ONE THAT SEEMS TO BE IN SOME DISTRESS. WHAT TOOK YOU SO LONG TO DIAGNOSE THESE PROBLEMS AND REALLY LAY OUT THE VISION FOR HOW YOU'RE GOING TO TRY AND FIX THEM?

WHITMAN: WELL, YOU RECALL WHEN I TOOK OVER AT HP, IT WAS A COMPANY THAT HAD BEEN THROUGH PRETTY TURBULENT TIMES. I WAS THE THIRD CEO IN THREE YEARS. AND IT IS A HUGE COMPANY, SIX MAJOR BUSINESSES, OVER 320,000 EMPLOYEES IN 166 COUNTRIES. AND I NEEDED TO DIVE INTO EACH AND EVERY BUSINESS, TO UNDERSTAND EACH FUNCTION. I NEEDED TO MEET WITH CUSTOMERS AND PARTNERS AND EMPLOYEES TO REALLY TAKE STOCK OF THE CHALLENGES THAT WE FACE. SO THAT'S -- YOU KNOW, YESTERDAY, AFTER A YEAR'S WORTH OF WORK, I HAD PEELED THE ONION AND CAME OUT AND TOLD THE INVESTMENT COMMUNITY, HERE'S OUR OPPORTUNITIES. HERE'S THE CHALLENGES, WHICH PRESENT OPPORTUNITIES. AND HERE'S THE PRODUCTS THAT WE'RE GOING TO REBUILD HP ON. AND WE TALKED ABOUT OUR PRODUCTS IN OUR SERVER DIVISION, IN OUR PC BUSINESS, IN OUR PRINTING BUSINESS AND LAID OUT THE TURNAROUND PLAN WHICH I'VE SAID FROM THE BEGINNING WAS A FOUR OR FIVE-YEAR PLAN.

FABER: YOU KNOW, MEG YESTERDAY YOU ALSO USED THE WORD "STABILIZATION," REFERRING TO AT LEAST YOUR JOB, YOU SAID, NUMBER ONE WAS TO STABILIZE THE COMPANY. LOOKING AT THAT STOCK PRICE, IT DOESN'T SEEM AS THOUGH IT'S BEEN STABILIZED. WHAT GIVES YOU THE CONFIDENCE, AND ALSO YOU REPORTED NUMBERS YESTERDAY THAT SHOWED DECREASES IN REVENUES IN A COUPLE OF KEY AREAS. WHAT GIVES YOU THE CONFIDENCE THAT YOU HAVE STABILIZED HP?

WHITMAN: WELL, WHEN I REFERRED TO STABILIZATION WHEN I FIRST CAME TO HP, I WAS TALKING ABOUT RESTORING CONFIDENCE IN OUR EMPLOYEE BASE, IN OUR CUSTOMER BASE BECAUSE, OF COURSE, WE HAD JUST ANNOUNCED THAT PERHAPS WE WERE SPINNING THE PSG DIVISION OUR PERSONAL COMPUTER DIVISION, THAT WE JUST BOUGHT AUTONOMY THAT WE WERE SHUTTING DOWN WEB OS. I JUST HAD TO PROVIDE A STEADY HAND ON THE TILLER AND REAFFIRM THE BUSINESSES THAT HP WAS IN THAT WE'RE COMMITTED TO THE PRINTING BUSINESS, THAT THE CORE OF THIS COMPANY IS A HARDWARE COMPANY, SERVER, STORAGE AND NETWORKING AND THEN LAY OUT THE ROLE OF SOFTWARE AND SERVICES IN OUR OVERALL PORTFOLIO. SO I THINK WE'VE DONE A GOOD JOB OF LETTING PEOPLE KNOW WHAT BUSINESSES WE'RE IN, THE PATH FORWARD. NOW, FROM A STOCK PRICE POINT OF VIEW, WE HAVE TO DELIVER THE RESULTS. AND WE HAVE TO DELIVER THE PRODUCTS THAT ARE GOING TO TURN THIS COMPANY AROUND. AND NOW I THINK WE'VE GOT 320,000 EMPLOYEES WHO UNDERSTAND WHAT THE CHALLENGES ARE. AND AS I'VE SAID, I WOULD NOT BET AGAINST 320,000 HP EMPLOYEES WHEN WE GET EVERYONE MARCHING IN THE SAME DIRECTION, YOU'D BE AMAZED WHAT THIS GROUP OF PEOPLE CAN DO. SO I'M CONFIDENT THAT 2013 WILL BE THE BOTTOM OF, YOU KNOW, THE TURNAROUND. AND THEN YOU CAN LOOK FORWARD, I THINK, TO GOOD GROWTH IN 2014 AND 2015 AS THOSE PRODUCTS KICK IN, THE INVESTMENTS THAT WE'RE MAKING IN THINGS LIKE I.T., SYSTEMS, IN OUR SALES ORGANIZATION, IN TRAINING. THOSE THINGS WILL START TO KICK IN. AND I REALLY DO THINK 2014's GOING TO BE QUITE A BRIGHT YEAR FOR HP.

FABER: YOU KNOW, MEG, THERE ARE SOME PEOPLE OUT THERE WHO DON'T SHARE YOUR CONFIDENCE WHEN IT COMES TO TWO KEY AREAS OF THE COMPANY. YOU MENTION THEM, OF COURSE, PRINTING AND PCs. THEY WATCHED THE MOVEMENT TO TABLETS AMONGST SO MANY PEOPLE, PARTICULARLY THE YOUNGER GENERATION, AND WHAT THEY AT LEAST CLAIM IS A LACK OF PRINTING ON THEIR PART. INSTEAD OF TAKING HOME DOCUMENTS, YOU TAKE HOME YOUR TABLET, YOU DON'T PRINT. WHAT GIVES YOU THE CONFIDENCE THAT THIS CAN CONTINUE TO BE AN IMPORTANT COMPONENT OF THIS COMPANY GIVEN THESE SIGNIFICANT CHANGES THAT ARE TAKING PLACE IN TECHNOLOGY?

WHITMAN: YEAH. WELL, FIRST OF ALL, I THINK THE DESIRE FOR PEOPLE TO COMPUTE, TO CREATE, TO SHARE, TO COMMUNICATE IS ACTUALLY NOT SHRINKING. IT'S GROWING. AND SO THE PERSONAL COMPUTING DEVICES, I THINK, ARE GOING TO CONTINUE TO GROW. AND, OF COURSE, YOU KNOW, EVEN THE CLASSIC NOTEBOOKS, OUR NEW THIN AND LIGHT NOTEBOOK LIKE THE SPECTER XT, WE'VE HAD TREMENDOUS RESPONSE TO THAT. SO WE'RE GOING TO HAVE A FULL LINE OF OFFERINGS FROM WORK STATIONS TO DESKTOPS TO NOTEBOOKS. AND THEN, OF COURSE, WE'RE ENTERING INTO THE TABLET CATEGORY, TOO, BUT NOT AS JUST A SIMPLE TABLET, A CONVERTIBLE WHERE YOU CAN HAVE THE BENEFITS OF A LAPTOP PLUS THE BENEFITS OF A PURE TABLET. AND THEN ONE THING I'M VERY EXCITED ABOUT IS OUR ELITE PAD WHICH IS THE FIRST TABLET DESIGNED SPECIFICALLY FOR THE ENTERPRISE. IT HAS SERVICEABILITY. IT HAS WHAT WE CALL SMART JACKETS THAT ALLOW YOU TO CUSTOMIZE THAT TABLET FOR YOUR INDUSTRY. WHEN YOU PUT THE SMART JACKET ON, IT GOES FROM THE TEN-HOUR BATTERY LIFE THAT'S BUILT INTO THE TABLET TO ANOTHER TEN HOURS OF BATTERY LIFE IN THE SMART JACKET. SO WE'RE IN THAT BUSINESS, TOO, NOW. AND I THINK WE'RE GOING TO DO VERY WELL THERE. AND THEN PRINTING, YOU KNOW, LISTEN, COMMERCIAL PRINTING CONTINUES TO GO UP. SOME SECULAR TRENDS IN CONSUMER, BUT WE'VE GOT SOME NEW PRODUCTS COMING IN PRINTING, TOO, AS WELL.

JIM CRAMER: MS. WHITMAN, I TRULY APPRECIATE YOU COMING ON THE SHOW. I CANDIDLY HAVE BEEN VERY CRITICAL OF THE COMPANY. I WOULD LIKE TO KNOW, IN AN EXCELLENT INTERVIEW, TWO DAYS, MARIA BARTIROMO, WITH Larry EllisON, CEO OF ORACLE, HE MADE IT CLEAR THAT THIS COMPANY WAS DOING POORLY UNTIL MARK HURD CAME IN. THEN WHEN HE LEFT, THE COMPANY WAS FINISHED. WHAT DO YOU THINK OF MR. EllisON'S ANALYSIS?

WHITMAN: LISTEN, YOU KNOW, THERE'S BEEN A LOT OF CHANGE AT THE TOP OF HP, A LOT OF ACQUISITIONS OVER THE YEARS. YOU KNOW, ONE THING PEOPLE DON'T REALLY RECOGNIZE IS OVER THE LAST TEN YEARS WE'VE GONE FROM A PRINTING COMPANY TO A DIVERSIFIED TECHNOLOGY COMPANY. TODAY 43% OF OUR PROFITS COME FROM OUR ENTERPRISE SERVICES GROUP, SERVERS, STORAGE AND NETWORKING AND THE SERVICES BUSINESS THAT GOES ALONG WITH IT. SO LISTEN, WE'VE GOT A GREAT SET OF ASSETS HERE. WE UNDERSTAND THE PROBLEMS. AND WE'RE ABOUT FIXING THEM. AND I THINK IT'S A GREAT OPPORTUNITY. YOU KNOW, THESE ARE -- I BELIEVE THIS IS ALL VERY FIXABLE. IT'S GOING TO TAKE TIME. THERE ARE NO SILVER BULLETS. IT'S BASIC BLOCKING AND TACKLING. WE KNOW HOW TO DO THIS. NOW WE'VE GOT A ROAD MAP AND WE'RE GOING TO GO DO IT.

CRAMER: MS. WHITMAN, WHAT DO YOU SAY ABOUT THE NEXT GENERATION? THE NEXT GENERATION WANTS APPLE. I DON'T SEE PEOPLE BEGGING FOR HP PCs, I DO NOT SEE PEOPLE SAYING I'M WAITING FOR THE TABLET. I ALSO NOTICED MICROSOFT IS GOING AGAINST YOU. YOU'RE SUPPOSED TO BE A GOOD CUSTOMER OF THEM. WHAT DO YOU SAY TO THE NEXT GENERATION WHO SAYS LISTEN, YOU KNOW WHAT? FORGET APPLE. STEVE JOBS, HE'S GONE, IT DOESN'T MATTER, STICK WITH HEWLETT!


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