News release

HP Tapped for $290 Million Defense Logistics Agency Contract

HP today announced that it has been awarded a 10-year contract worth $290 million by the Defense Logistics Agency (DLA), an agency of the U.S. Department of Defense. The contract focuses on the DLA's Enterprise Data Center (EDC) program, an initiative that will create a single, organization-wide information technology infrastructure, resulting in savings and efficiencies for the agency.

"With the EDC, DLA is taking a huge step forward for the agency, the Department of Defense, the government and, ultimately, the taxpayers. We're really looking forward to working with HP to ensure the program's success," said Mark Philip, program manager for the EDC, Defense Logistics Agency. "EDC is a very significant IT effort that will help DLA fulfill its mission to manage the logistics supply chain and better serve its customers, now and into the future."

"We are very proud to have won the confidence of such an important customer," said James Weynand, vice president and general manager - Americas, Public Sector, Health and Education, HP. "The Defense Logistics Agency is a critical part of the U.S. armed services, and as such, is committed to being on the leading edge in terms of integrating their systems, data, processes and people; providing secure access to data and applications on the go; and ultimately transforming their processes and IT to better serve the needs of their customers."

The EDC program will consolidate large numbers of DLA servers and infrastructure into centralized facilities using the latest HP technology, thus allowing more efficient support to U.S. service members. The EDC will reduce DLA's IT inventory resulting in a reduction of the agency's total cost of ownership and will create a more modern IT infrastructure.

The EDC also will allow for more effective implementation of DLA's information assurance programs across the agency and will expand its disaster recovery and continuity of operations programs.

The contract is a five-year agreement with additional one-year options for another five years. As proposed, it will have a 10-year cost of $290,127,642. Most DLA servers, applications and storage will be consolidated by the EDC migration, which will be staggered over time to minimize disruptions in customer service.

About HP

HP is a technology solutions provider to consumers, businesses and institutions globally. The company's offerings span IT infrastructure, personal computing and access devices, global services and imaging and printing. For the four fiscal quarters ended July 31, 2004, HP revenue totaled $78.4 billion. More information about HP (NYSE, Nasdaq: HPQ) is available at http://www.hp.com.

This news release contains forward-looking statements that involve risks and uncertainties, as well as assumptions that, if they ever materialize or prove incorrect, could cause the results of HP and its consolidated subsidiaries to differ materially from those expressed or implied by such forward-looking statements and assumptions. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including the expected development, performance or rankings of products or services; statements of expectation or belief; and any statement of assumptions underlying any of the foregoing. Risks, uncertainties and assumptions include the development, performance and market acceptance of products and services and other risks that are described from time to time in HP's Securities and Exchange Commission reports, including but not limited to HP's Quarterly Report on Form 10-Q for the period ended July 31, 2004 and other reports filed after HP's Annual Report on Form 10-K for the fiscal year ended Oct. 31, 2003. HP assumes no obligation and does not intend to update these forward-looking statements.