During an October 1, conference call with Security Analysts, Carly Fiorina, HP's new president and CEO, surrendered a certain reluctance about talking about the future of HP. Unfortunately, some of the news was not as good as expected. Fiorina indicated that HP's fourth quarter revenue growth expected to be within 10% to 13% range could be jeopardized by the aftermath of the Tawain earthquake. Wall Street analysts were predicting about 7% growth. The admission set HP's stock price back about 20% from recent highs. However, HP's printer and imaging, PC and UNIX business are doing well. HP's Internet-based E-services strategy is also gaining recognition. In perhaps the first test of her leadership, Fiorina also announced several executive staff changes: Ann Livermore will be accountable for three key areas. First, she will continue her excellent work on e-services and take it across the company. E-services continues to open doors for us, and it represents huge opportunities for growth and leverage for HP. Ann will drive the strategy, make the deals and call the plays for this, our central Internet strategy. Second, Ann will manage and transform the total customer experience for our enterprise and commercial customer segments. This includes enterprise sales, service and support and commercial sales. Additionally, Ann will manage our top 100 accounts as businesses. Each account will be run by a client business manager fully responsible for managing an entire portfolio with their customer and overseeing the total sales engagement process. In other words, no more negotiating with the various siloed businesses. Third, Ann will have responsibility for our professional services and financial services activities across the businesses. This is a second very important strategic growth opportunity we have identified. Again, Ann will be responsible for driving strategy, making the deals and calling the plays with HP and our partners in this all-important growth market. Antonio Perez will be responsible for three key areas: First, he will capitalize on the hugely important digital-imaging opportunity for HP. Our strategic intent here is to dramatically accelerate the digital transformation of photographs and other image-rich documents and bring them to HP’s product platforms. This is our third critical area for focus and growth and Antonio will help us meet the opportunity head on. He will be driving the strategy, designing the architecture and specifications for e-imaging, securing partnership deals and making all the decisions necessary to capture early wins in this new, exciting and burgeoning market segment.Second, Antonio will also have accountability for the total customer experience for the consumer marketplace. This includes responsibility for all consumer sales and support as well as building a relationship with our consumers using the unique advantages of the Internet. We have carved out a wonderful position in this segment in a very short period of time, and we intend to capitalize on it.Third, Antonio will lead the revitalization activities associated with the HP brand, working with brand managers throughout the company to accomplish this. This includes responsibility for brand management, advertising and We’re going to start our new fiscal year with an exciting brand positioning, and we are on track to unveil a compelling and integrated advertising campaign in December. Ann and Antonio, in their new roles, will be responsible for transforming the customer experiences we provide into a competitive advantage, representing customers’ needs and requirements to HP and driving our engagements with customers and partners on behalf of HP.Duane Zitzner will lead our computing technologies: He will manage all UNIX and NT server products -- making the appropriate trade-offs and balancing our efforts and our technology investments. Duane Zitzner is one of our brightest and most aggressive technologists and I am delighted that he is taking on these new responsibilities.Bill Russell, general manager of Enterprise Systems and Software will now report to Duane. He is charged with the task of defending and growing our core server business in this capacity.Duane will also pull together all of our storage activities in HP. Our activities in storage today are a bit fragmented and we need a more focused approach to get us where we need to go. We will have a strong, well-aligned effort to guarantee that we can win in this dynamic, rapidly changing market, which represents another key growth opportunity for us.Duane will also be responsible for HP’s software stack. And, this includes software that differentiates HP’s systems and multiplatform software businesses. Carolyn Ticknor will lead our printing and imaging technologies and platforms: She will be accountable for all printing platforms. We’re incredibly strong in these markets today but we need to ensure that we widen our lead and grow this core business for years to come.Carolyn’s role will include ensuring that we get greatest leverage from our investments in both inkjet and LaserJet technologies and that we build on our leading market positions. Duane and Carolyn, in their new roles, will be accountable for rapid innovation on behalf of customers and in response to competitors; product reliability, quality and value; interoperability, speed to market and cost. Duane and Carolyn are responsible for making the R&D tradeoff decisions necessary to ensure appropriate investment levels.This new set of roles and responsibilities for our four presidents reflects, in my view, the essence of an ambidextrous organization -- one that is positioned to make smart trade-offs based on a clear view of the big picture. Delighting customers with their overall HP experience and delighting shareowners is how we’re going to measure ourselves.For the full text of her presentation: are also looking at improving the efficiency of our infrastructure across the company where I believe there are significant opportunities for cost savings and performance improvements. We are replicating efforts across the company unnecessarily, and we are moving to address that. Specific cost-saving targets are currently being set in each area for incorporation into our Fiscal 2000 plans. I believe the changes outlined here, that we are announcing to the organization, position us to be a high-performance company as we move into 2000. These changes allow us to build off the strengths we have demonstrated in our core businesses, address areas of weakness, and position ourselves to capitalize on growth opportunities.As I look to next year, I think the growth and profit plans reflected in your estimates are very reasonable and doable. They represent a continuation of solid performance from the HP businesses that are currently performing well, and a return to solid results in UNIX servers and storage. My near-term goal is to lead this organization to deliver these results.Beyond that, I believe HP can deliver much more to our shareholders. More growth and more profits. And I look forward to telling you more about how we’re going to do that, but that is for another day. Specifically, we’ll be talking much more about that when we get together in December.In the near term, we are putting our money to work in a great investment -- HP stock. We are confident in our future, and are taking advantage of the recent weakness in the stock to be very aggressive in our buyback program. In fact, we are in the market right now at a rate greater than at any time in the last 12 years.Thank you very much.

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