News release

HP Captures No. 1 in Worldwide Blade Server Market

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HP took the No. 1 position in worldwide blade server factory revenue and units shipped, according to fourth calendar quarter 2006 server market figures released today by industry analyst firm IDC.⁽¹⁾

HP overtook IBM to lead the blade server market in the fourth quarter with 41.9 percent factory revenue share and 40.0 percent total factory units share, and showed more than ten times the growth of IBM in units and revenue year-over-year.

For the 19th consecutive quarter, HP led the worldwide server market in total units shipped, with 31.6 percent share in the fourth quarter. HP also outpaced industry unit growth at 4.6 percent year-over-year in that quarter, taking share from the two nearest competitors.

"IDC's numbers show that HP continues to maintain its strength in the worldwide server market and our latest achievements in the blade server space underscore the tremendous market acceptance of HP's breakthrough BladeSystem c-Class architecture," said Mark Hudson, vice president of marketing, Enterprise Storage and Servers, HP. "We will continue to deliver innovation across our entire server portfolio and provide customers with a superior IT infrastructure that helps them drive business growth and lower costs."

Highlights from IDC's worldwide report include:

• Marking the 42nd consecutive quarter of x86 server market leadership, HP again ranked No. 1 in server units shipped for fourth quarter and 2006. The company showed continued success with its HP ProLiant family of servers, now available with Intel® Xeon™ quad-core processors, by increasing its lead to 33.9 percent factory revenue share in the fourth quarter(2);



• In the high-performance computing market, HP was No.1 in revenue for 2006, with 33 percent market share, and surpassed industry revenue growth by nearly two times with 16.7 percent year-over-year growth.(3) This marks the fourth consecutive year of HP revenue leadership in the high-performance computing market;



• HP continues to lead the increasingly competitive AMD® Opteron™ processor-based server market segment in both revenue and factory units shipped, increasing its fourth quarter market shares year-over-year by 4.6 percent and 5.6 percent, respectively;



• HP held the No. 1 position in the EPIC/Itanium market segment in both factory revenue and units shipped, showing 82.2 percent and 69.2 percent year-over-year growth, respectively, in the fourth quarter. The growth was driven by solid market acceptance of the HP Integrity family of servers with Intel Itanium® 2 "Montecito" processors;



• HP again held a commanding lead with 31.3 percent market share in combined Windows®, Linux and UNIX® server revenue for 2006, with the three operating systems accounting for more than 97 percent of all servers shipped worldwide and more than 80 percent of all server revenue;



• HP continues to be the world's No. 1 Linux server vendor, growing more than twice as fast as the market in both revenue and units shipped, and holding more than 33 percent revenue and units market share in the fourth quarter; and



• HP maintained the top position in the high-end UNIX(4) server market segment in calendar year 2006, and increased year-over-year revenue and units shipped in the volume UNIX(5) segment, gaining share from competitors.

More information about HP servers is available at http://www.hp.com/go/servers.

About HP

HP focuses on simplifying technology experiences for all of its customers - from individual consumers to the largest businesses. With a portfolio that spans printing, personal computing, software, services and IT infrastructure, HP is among the world's largest IT companies, with revenue totaling $94.1 billion for the four fiscal quarters ended Jan. 31, 2007. More information about HP (NYSE: HPQ) is available at http://www.hp.com.

⁽¹⁾ IDC, Q406 Worldwide Quarterly Server Tracker, February 2007.

⁽²⁾ Includes Compaq ProLiant from Q196 through Q202 and HP ProLiant from Q302 through Q406.

⁽³⁾ IDC, Worldwide Technical Server QView Q4 2006, February 2007.

⁽⁴⁾ Systems priced at US$500,000 and more.

⁽⁵⁾ Systems priced at US$25,000 or less.

Intel, Xeon and Itanium are trademarks or registered trademarks of Intel Corp. or its subsidiaries in the United States and other countries. . AMD and Opteron are trademarks or registered trademarks of Advanced Micro Devices, Inc. Windows is a U.S. registered trademark of Microsoft Corp. UNIX is a registered trademark of The Open Group.

This news release contains forward-looking statements that involve risks, uncertainties and assumptions. If such risks or uncertainties materialize or such assumptions prove incorrect, the results of HP and its consolidated subsidiaries could 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 but not limited to statements of the plans, strategies and objectives of management for future operations; any statements concerning expected development, performance or market share relating to products and services; anticipated operational and financial results; any statements of expectation or belief; and any statements of assumptions underlying any of the foregoing. Risks, uncertainties and assumptions include the achievement of expected results and other risks that are described from time to time in HP's Securities and Exchange Commission reports, including but not limited to the risks described in HP's Annual Report on Form 10-K for the fiscal year ended Oct. 31, 2006 and other reports filed after that Form 10-K. HP assumes no obligation and does not intend to update these forward-looking statements.