HP has named Emma Walmsley, former CEO of GSK and a Microsoft board member, as its new chief executive officer. She is set to succeed interim CEO Bruce Broussard on January 4.
Walmsley, who led the pharmaceutical giant GSK from 2017 until December of last year, steps into the role as HP faces a challenging market characterized by rising memory chip prices and a significant industry downturn. Her appointment comes as the PC maker seeks to revitalize a sluggish market and tap into the growing demand for AI-enabled devices. She does not have prior experience in tech hardware, but her background in steering large companies through restructuring, including the separation of GSK's consumer health division Haleon, is seen as relevant to HP's current needs.
"Walmsley has no background in hardware, but she has experience steering a large company through a major restructuring, including the separation of Haleon from GSK, and that is closer to what HP needs," said Vitor Madeira, senior market specialist at Capital.com.
HP, along with competitors such as Dell Technologies, Apple, and Lenovo, is contending with a global shortage of memory chips. This scarcity is largely attributed to the significant demand from the construction of AI data centers, which are absorbing a substantial portion of available chip production capacity.
The impact of this squeeze was evident in HP's third-quarter financial results, released in August. Despite a 16% decline in PC shipments, the company's PC unit revenue increased by 18%, driven by a strategic shift towards more expensive, higher-margin products, including AI PCs.
In a September SEC filing, HP indicated that it is not providing a financial outlook for fiscal year 2027 and anticipates a mid-single-digit decline in overall PC unit volumes for the upcoming year.
Bruce Broussard will transition to the role of board chair, replacing Chip Bergh. HP's stock saw a rise of over 6% following the announcement.
Walmsley's previous experience includes a 17-year tenure at L'Oréal before her time at GSK, and she has served on Microsoft's board for seven years. The primary challenge for Walmsley will be to maintain profitability during the current downturn and to identify avenues for growth beyond traditional PCs, such as in the emerging AI device sector, before the cost of memory components stabilizes.