HP 2012 Annual Report Download - page 39

Terrorist acts, conflicts, wars and geopolitical uncertainties may seriously harm our business and revenue,
costs and expenses and financial condition and stock price.
Terrorist acts, conflicts or wars (wherever located around the world) may cause damage or
disruption to HP, our employees, facilities, partners, suppliers, distributors, resellers or customers or
adversely affect our ability to manage logistics, operate our transportation and communication systems
or conduct certain other critical business operations. The potential for future attacks, the national and
international responses to attacks or perceived threats to national security, and other actual or potential
conflicts or wars, including the ongoing military operations in Afghanistan, have created many
economic and political uncertainties. In addition, as a major multinational company with headquarters
and significant operations located in the United States, actions against or by the United States may
impact our business or employees. Although it is impossible to predict the occurrences or consequences
of any such events, if they occur, they could result in a decrease in demand for our products, make it
difficult or impossible to provide services or deliver products to our customers or to receive
components from our suppliers, create delays and inefficiencies in our supply chain and result in the
need to impose employee travel restrictions. We are predominantly uninsured for losses and
interruptions caused by terrorist acts, conflicts and wars.
Any failure by us to identify, manage, complete and integrate acquisitions, divestitures and other significant
transactions successfully could harm our financial results, business and prospects, and the costs, expenses and
other financial and operational effects associated with managing, completing and integrating acquisitions may
result in financial results that are different than expected.
As part of our business strategy, we frequently acquire companies or businesses, divest businesses
or assets, enter into strategic alliances and joint ventures and make investments to further our business
(collectively, ‘‘business combination and investment transactions’’). In order to pursue this strategy
successfully, we must identify candidates for and successfully complete business combination and
investment transactions, some of which may be large or complex, and manage post-closing issues such
as the integration of acquired businesses, products, services or employees. Risks associated with
business combination and investment transactions include the following, any of which could adversely
affect our revenue, gross margin and profitability:
• Managing business combination and investment transactions requires varying levels of
management resources, which may divert our attention from other business operations.
• We may not fully realize all of the anticipated benefits of any business combination and
investment transaction, and the timeframe for realizing benefits of a business combination and
investment transaction may depend partially upon the actions of employees, advisors, suppliers
or other third parties.
• Business combination and investment transactions have resulted, and in the future may result, in
significant costs and expenses and charges to earnings, including those related to severance pay,
early retirement costs, employee benefit costs, goodwill and asset impairment charges, charges
from the elimination of duplicative facilities and contracts, in-process research and development
charges, inventory adjustments, assumed litigation and other liabilities, legal, accounting and
financial advisory fees, and required payments to executive officers and key employees under
retention plans.
• Any increased or unexpected costs, unanticipated delays or failure to meet contractual
obligations could make business combination and investment transactions less profitable or
unprofitable.
• Our ability to conduct due diligence with respect to business combination and investment
transactions, and our ability to evaluate the results of such due diligence, is dependent upon the
31