Carly Fiorina, Chairman and CEO of Hewlett-Packard

This is a partial transcript from Your World with Neil Cavuto, November 19, 2003, that was edited for clarity.

Watch Your World w/Cavuto weekdays at 4 p.m. and 1 a.m. ET.

NEIL CAVUTO, HOST: Just when people thought the tech sector was on a decline, my next guest spearheaded one of the largest deals in technology ever, Hewlett-Packard combining with Compaq. With us live on the phone with some pretty good earnings in her own right now in the latest period, Carly Fiorina, Hewlett-Packard’s chairman and CEO. Those earnings, by the way, were about a cent better than expected, 36 cents, revenues coming in at close to $20 billion, that’s almost a billion dollars better than Wall Street thought.

Carly, thank you for joining us.

CARLY FIORINA, HEWLETT-PACKARD CHMN. & CEO (HPQ): Good afternoon, Neil, my pleasure.

CAVUTO: This surprised the Street in a lot of ways, not the least of which was your sentiment about things that appear to be picking up almost across the board. What does this say about where you are going in the future?

FIORINA: Well, I think it first says a lot about the fiscal year that we have just closed. This was a year in which we delivered on our commitments. We not only achieved profitability in each and every one of or businesses, but we also grew revenue and market share in all of our businesses, and exceeded our integration and cost-savings goals, did it ahead of schedule and generated cash flow from operations in excess of $6 billion for the year. We also made very important investments in our future across the business. So what we think this indicates is that we have gathering momentum in the marketplace. And we are entering 2004 in our strongest competitive position in HP’s history.

CAVUTO: Now Intel and IBM and GE in varying degrees have said they are optimistic as well. Is this a sign things are back to percolating?

FIORINA: Well, I would describe the economy in general as a gentle breeze, not a gale-force wind. I mean, certainly the economy appears to be picking up. We are seeing strength in the consumer business. We see continuing caution in the enterprise business. But there is no question that people are becoming a bit more optimistic. I don’t want to indicate that the results we have delivered are all as a result of better economics. I think in many cases our results reflect better competitive position and improving execution.

CAVUTO: Let me ask you a little bit about new forays you are planning certainly into the copier area, you’re going to take on Xerox, how much of this was in response to Dell trying to take on your printer business?

FIORINA: Actually, none of it. I mean, if you look at what we’ve done in our imaging and printing business, we just keep going from strength to strength. We continue to gain share in every category. Frankly, if you look at what Dell has done in the printing business, the share they are taking is away from their partner Lexmark, not from HP. And they’ve had, frankly, no impact on us. The copier announcement really is around our continued move into enterprise printing and a belief that we can take on Xerox in their home market.

CAVUTO: Let me ask you very quickly, I know you are politically astute as well, Arnold Schwarzenegger taking over in California, are you optimistic he can turn things around there?

FIORINA: Well, I’m very optimistic that this is a unique period of time in California. Schwarzenegger’s victory clearly gave him a broad mandate for change. He is very focused on improving the competitiveness of the state, something that I and others are working with him on. And focusing on the competitiveness of California is a very important initiative. So yes, I think that he, working with the rest of the legislature and the business community in California, can make a real difference.

CAVUTO: Let me ask you very quickly, to wrap things up, are you going to run for office?


FIORINA: Well, that is a funny question to ask me when we’ve just completed such a great fiscal year, frankly, I’m focused on running HP.

CAVUTO: It’s a perfect time to ask.

FIORINA: I’m focused on running HP.

CAVUTO: OK. Carly Fiorina, thank you very much, appreciate it.

FIORINA: You’re welcome, thank you.

CAVUTO: Chairman and CEO of Hewlett-Packard, Carly Fiorina.

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