Hewlett-Packard (HPQ)

Research and Development

        We remain committed to innovation as a key element of HP's culture. Our development efforts are focused on designing and developing products, services and solutions that anticipate customers' changing needs and desires and emerging technological trends. Our efforts also are focused on identifying the areas where we believe we can make a unique contribution and the areas where

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partnering with other leading technology companies will leverage our cost structure and maximize our customers' experiences.

        HP Labs, together with the various research and development groups within the five principal business segments, are responsible for our research and development efforts. HP Labs is part of our Corporate Investments segment.

        Expenditures for research and development were $2.8 billion in fiscal 2009, $3.5 billion in fiscal 2008 and $3.6 billion in fiscal 2007. We anticipate that we will continue to have significant research and development expenditures in the future to provide a continuing flow of innovative, high-quality products and services to maintain and enhance our competitive position.

        For a discussion of risks attendant to our research and development activities, see "Risk Factors—If we cannot continue to develop, manufacture and market products and services that meet customer requirements for innovation and quality, our revenue and gross margin may suffer," in Item 1A, which is incorporated herein by reference.

Research and Development

        We remain committed to innovation as a key element of HP's culture. Our development efforts are focused on designing and developing products, services and solutions that anticipate customers' changing needs and desires and emerging technological trends. Our efforts also are focused on identifying the areas where we believe we can make a unique contribution and the areas where partnering with other leading technology companies will leverage our cost structure and maximize our customers' experiences.

        HP Labs, together with the various research and development groups within the five principal business segments, are responsible for our research and development efforts. HP Labs is part of our Corporate Investments segment.

        Expenditures for research and development were $3.5 billion in fiscal 2008 and $3.6 billion in fiscal 2007 and 2006. We anticipate that we will continue to have significant research and development expenditures in the future to provide a continuing flow of innovative, high-quality products and services to maintain and enhance our competitive position.

        For a discussion of risks attendant to our research and development activities, see "Risk Factors—If we cannot continue to develop, manufacture and market products and services that meet customer requirements for innovation and quality, our revenue and gross margin may suffer," in Item 1A, which is incorporated herein by reference.

Research and Development

        We remain committed to innovation as a key element of HP's culture. Our development efforts are focused on designing and developing
products, services and solutions that anticipate customers' changing needs and desires and emerging technological trends. Our efforts also are focused on identifying the areas where we believe we can
make a unique contribution and the areas where partnering with other leading technology companies will leverage our cost structure and maximize our customers' experiences.

        HP
Labs, together with the various research and development groups within the five principal business segments, are responsible for our research and development efforts. HP Labs is part
of our Corporate Investments segment.

        Expenditures
for research and development were $3.5 billion in fiscal 2008 and $3.6 billion in fiscal 2007 and 2006. We anticipate that we will continue to have significant
research and development expenditures in the future to provide a continuing flow of innovative, high-quality products and services to maintain and enhance our competitive position.

        For
a discussion of risks attendant to our research and development activities, see "Risk Factors—If we cannot continue to develop, manufacture and market products and
services that meet customer requirements for innovation and quality, our revenue and gross margin may suffer," in Item 1A, which is incorporated herein by reference.

Research and Development

        We remain committed to innovation as a key element of HP's culture. Our development efforts are focused on designing and developing products, services and solutions that anticipate customers' changing needs and desires and emerging technological trends. Our efforts also are focused on identifying the areas where we believe we can make a unique contribution and the areas where partnering with other leading technology companies will leverage our cost structure and maximize our customers' experiences.

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        HP Labs, together with the various research and development groups within the five principal business segments, are responsible for our research and development efforts. HP Labs is part of our Corporate Investments segment.

        Expenditures for research and development were $3.6 billion in each of fiscal years 2007 and 2006 and $3.5 billion in fiscal 2005. We anticipate that we will continue to have significant research and development expenditures in the future to provide a continuing flow of innovative, high-quality products and services to maintain and enhance our competitive position.

        For a discussion of risks attendant to our research and development activities, see "Risk Factors—If we cannot continue to develop, manufacture and market products and services that meet customer requirements for innovation and quality, our revenue and gross margin may suffer," in Item 1A, which is incorporated herein by reference.

Research and Development

Total research and development (“R&D”) expense as a percentage of net revenue decreased slightly in the first quarter of fiscal 2007 as compared to the prior year period due primarily to revenue growing faster than R&D expense. R&D expense increased slightly in the first quarter of fiscal 2007 as compared

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to the prior year period due primarily to the unfavorable currency impacts related to the movement of the dollar against the euro.  As a percentage of net revenue, each of our major segments experienced a year-over-year decrease in R&D expense for the three months ended January 31, 2007.

Research and Development

        We remain committed to innovation as a key element of HP's culture. Our development efforts are focused on designing and developing products, services and solutions that anticipate customers' changing needs and desires and emerging technological trends. Our efforts also are focused on identifying the areas where we believe we can make a unique contribution and the areas where partnering with other leading technology companies will leverage our cost structure and maximize our customers' experiences.

        HP Labs, together with the various research and development groups within the five principal business segments, are responsible for our research and development efforts. HP Labs is part of our Corporate Investments segment.

        Expenditures for research and development in fiscal 2005 were $3.5 billion, as compared to $3.6 billion in fiscal 2004 and $3.7 billion in fiscal 2003. We anticipate that we will continue to have significant research and development expenditures in the future to provide a continuing flow of innovative, high-quality products and services to maintain and enhance our competitive position.

        For a discussion of risks attendant to our research and development activities, see "Risk Factors—If we cannot continue to develop, manufacture and market products and services that meet customer requirements for innovation and quality, our revenue may suffer," in Item 1A, which is incorporated herein by reference.

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Research and Development

        Our development efforts are focused on designing and developing products, services and solutions that anticipate customers' changing needs and desires and emerging technological trends. Our efforts are also focused on identifying the areas where we believe we can make a unique contribution and the areas where partnering with other leading technology companies will maximize our cost structure and our customers' experiences. Key research focus areas include:

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Next-generation computing: Using industry-standard components to develop an adaptive IT infrastructure that automatically and securely moves, balances, shares and reuses computing resources as needed.



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Imaging and printing growth: Expanding HP technologies into new areas, such as commercial printing; developing smarter cameras, video projectors, 3D imaging, enhanced device connectivity and other technologies for innovative imaging applications.



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Industry collaborations: Developing solutions for customers in fields undergoing rapid change, such as mobile devices and infrastructure for life sciences and education.



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Technologies for services: Developing architecture, tools, platforms and software in the areas of adaptive infrastructure and services, as well as creating platforms, services and solutions that provide end-to-end security.



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Consumer systems: Creating architectures that enable systems and devices to work better together, including developing and driving open, cross-industry standards.



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Emerging and transformative technologies: Continuing to push the boundaries of science in areas such as the development of nanoscale molecular computing and flexible displays as well as designing product features targeted at making technology affordable and useful for customers in emerging markets.

        HP Labs, together with the various research and development groups within the five principal business segments, are responsible for our research and development efforts. HP Labs is part of our Corporate Investments segment.

        Expenditures for research and development in fiscal 2004 were $3.5 billion, as compared to $3.7 billion in fiscal 2003 and $3.4 billion in fiscal 2002. We anticipate that we will continue to have significant research and development expenditures in the future to provide a continuing flow of innovative, high-quality products and services to maintain and enhance our competitive position.

        For a discussion of risks attendant to our research and development activities, see "Management's Discussion and Analysis of Financial Condition and Results of Operations—Factors That Could Affect Future Results—If we cannot continue to develop, manufacture and market products and services that meet customer requirements for innovation and quality, our revenue may suffer" in Item 7, which is incorporated herein by reference.