HP CEO Steps Down Following Sexual Harassment Investigation

HP announced Thursday that CEO and President Mark Hurd was stepping down from his position at the world’s largest computer maker. The surprise move comes amidst charges of sexual harassment from a former contractor. An investigation HP conducted with the assistance of outside legal counsel found that Mr. Hurd had not violated HP’s sexual harassment policy, but that he had violated the company’s Standards of Business Conduct.

Current CFO Cathie Lesjak will take over as interim CEO, but has ruled herself out as a permanent replacement for Mr. Hurd. Instead, the company has formed a Search Committee of board members who will be looking for a new head honcho for HP.

The company also stressed that it’s the personal scandal involved in Mr. Hurd’s conduct that have resulted in his resignation, and not the company’s financial results.

As part of the announcement, HP took the somewhat unusual move of releasing preliminary results for the July quarter, with revenue of US$30.7 billion, up 11% from the prior year. Earnings per share (EPS) are approximately $0.75 and non-GAAP diluted EPS were approximately $1.08.

Indeed, HP has done well under Mr. Hurd’s leadership, displacing Dell as the world’s largest PC maker — the company expects to do more than $125 billion in sales during fiscal 2010. HP will officially announce results for the July quarter on Thursday, August 19th.

Shares in HP closed lower during the regular trading session at $40.62, down 0.340 (-0.83%), on moderate volume of 949,000 shares trading hands, but then gained in after-hours trading to $41.00, up $0.380 (+0.94%).