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HP Garners Revenues Topping $1.9 Billion from Large Retail Customers Over Last Year

Recent HP Installations Include Some of World's Leading Retail Brands
PALO ALTO, CALIF., JUNE 5, 2003

HP (NYSE:HPQ) today announced that it achieved vertical industry revenues of more than $1.9 billion from large retail accounts since its merger with Compaq.

Sales to these Tier 1/Tier 2 retailers demonstrate the success of HP's strategy to deliver products, services and solutions tailored to meet the needs of customers in key vertical industries.

"HP is committed to delivering solutions that meet retailers' most pressing needs - from the largest enterprises in the world to small- and medium-sized businesses just around the block," said Jim Milton, senior vice president, HP Enterprise Systems Group, and managing director, HP Americas. "The retail business environment is among the most competitive. HP's ability to deliver retail solutions that have a lower total cost of ownership than proprietary offerings puts HP squarely in the retailer's corner."

HP's breadth of products and services reach from the point of sale through to back-office operations, providing retailers with complete in-store and store-to-headquarters IT infrastructure.

"Retailers must have a consistent, predictable IT infrastructure, yet one that can be easily adjusted to meet changes in the business environment," said Milton. "That seeming contradiction makes HP's comprehensive portfolio of solutions a perfect fit for retailers looking to build an adaptive enterprise. The HP Adaptive Enterprise strategy is designed to help businesses enhance their agility and improve service levels even as they reduce risk and lower costs."

HP is positioned in the market as the No. 1 vendor of servers, holding 29 percent worldwide market share based on total unit shipments in the first quarter of 2003(1).

In addition, HP NonStop servers power the payment systems for many of the nation’s largest retailers.

"A single retail customer - one of the world's largest retailers - now accounts for $100 million in revenue to HP annually," said Leigh Morrison, vice president, U.S. industry sales and solutions, HP Enterprise Systems Group. "We see several other key retail accounts approaching that level over the next year."

Retail Strategy and Customer Announcements

As retailers increasingly move away from costly proprietary systems to lower cost, open, standards-based platforms and operating environments, HP's open systems, industry-leading partners such as Intel and Microsoft, and strategies such as computing-on-demand enable retailers to implement IT solutions incrementally, without large upfront capital outlays.

HP's approach enables retailers to migrate from aging, proprietary systems to open, standards-based systems, without having to immediately replace the legacy equipment. This approach provides a quick route to positive return on investment, minimizes risk, conserves IT spending capital and increases a retailer's ability to respond to rapidly changing market conditions and customer demands.

HP has recently signed agreements with several leading retail entities across a range of industries, including (in alphabetical order):

Circuit City - Circuit City Stores, Inc. has selected HP servers, storage and services to support an ongoing effort to upgrade the technology infrastructure in selected stores across the United States. (See related HP news release titled "HP Provides Circuit City with Technology and Services for Store IT Upgrade")

FTD - Building on its ongoing commitment and support of member florists across the country, FTD has partnered with HP in a technology and marketing alliance agreement that ensures FTD's 20,000 member florists have the opportunity to purchase customized Compaq Evo D500 series desktop PCs as well as monitors and printers to support the FTD Mercury 5.0 application.

"HP understands the unique technology requirements of FTD and can provide the right cost and space-efficient technologies that help our member florists grow their businesses and achieve a great return on their technology investments," said Michael Soenen, executive vice president of technology, FTD.

The Home Depot - HP provided Home Depot with 40,000 HP Evo D510 PCs for use in its more than 1,450 stores across the United States. The PCs will support Home Depot programs that together will improve operations, customer service and employee education efforts in the stores. The new systems will supplement existing existing Unix technology from HP that Home Depot uses in its stores and administrative offices. A number of the PCs will be used to expand Home Depot's e-learning initiative, an in-store, on-line help employees build their product knowledge and work toward certifications in various disciplines.

Rent-A-Center, Inc. - Rent-A-Center is the largest rent-to-own operator in the United States, with more than 2,500 company-owned stores nationwide and in Puerto Rico. The company has deployed HP midrange UNIX systems in its IT infrastructure to help manage the large amount of information required to process and maintain rental agreements.

"We expect to receive even greater benefits from the performance and system availability with the HP rp8400 systems," said Tony Fuller, vice president of information technologies and chief technology officer, Rent-A-Center. "HP was able to easily fulfill the configuration and performance requirements for our business."

Safeway, Inc. - Safeway is one of the largest food and drug retailers in North America, with more than 1,600 stores in operation throughout the United States and Canada. It has relied on HP technology to keep its business-critical applications up and running 24 x 7. Understanding that fault tolerance is so important to its business and keeps its applications running without down time, Safeway has recently purchased HP NonStop technology worth millions of dollars for payments and warehousing.

Starbucks - As the preferred technology provider for Starbucks corporate headquarters and its network of retail stores, HP has outfitted more than 600 Starbucks district managers across the country with Compaq Evo notebook PCs, wireless "Wi-Fi" networking capability and virtual private networking. This allows these remote workers to securely access their e-mail, corporate reports and Internet-based critical business systems using the T-Mobile HotSpotSM high-speed wireless Internet service within the Starbucks stores they manage. This broad deployment of cutting-edge technology marks a significant innovation in the retail industry which promises to boost productivity and quality of management by field operations personnel.

High-speed wireless Internet access has become faster, simpler and more convenient as Starbucks, HP and T-Mobile International, the wireless subsidiary of Deutsche Telekom AG, have launched the T-Mobile HotSpot service in 2,100 Starbucks coffeehouses. As easy as ordering their latte, Starbucks customers can check e-mail, surf the Web, watch streaming video or download multimedia presentations in the comfort of Starbucks via a fast, reliable, standards-based wireless Internet connection for notebook, Tablet and Pocket PCs.

HP will be exhibiting during the Retail Systems 2003 conference and exhibition, June 9-12, booth 702, McCormick Place in Chicago.

About HP

HP delivers vital technology for business and life. The company's solutions span IT infrastructure, personal computing and access devices, global services and imaging and printing for consumers, enterprises and small and medium business. For the last four quarters, HP revenue totaled $70.4 billion. More information about HP is available at http://www.hp.com.


(1) Gartner Perspective, Q1CY2003, published April 25, 2003.

About HP

HP Inc. creates technology that makes life better for everyone, everywhere. Through our portfolio of printers, PCs, mobile devices, solutions, and services, we engineer experiences that amaze. More information about HP Inc. is available at http://www.hp.com.