EXHIBIT 99.2

STEPHEN J. PAVLOVICH:

I have to remind you that the primary purpose of this call is to provide you
with an update on HP's fiscal 2001 second quarter and third quarter guidance.

It's possible that some of our comments and responses to your questions may
include forward-looking statements. These forward-looking statements are
based on certain assumptions and are subject to a number of risks and
uncertainties, and actual future results may vary materially.

Again, I encourage you to read the risk factors described in the company's
annual report on Form 10-K for the year ended October 31, 2000 and our
subsequently filed reports for an understanding of the factors that may
affect the company's businesses and results.


CARLETON S. FIORINA:

Thanks Steve. Good morning everyone and thank you for joining us on short
notice.

As we move into the last two weeks of the quarter - which ends April 30th -
we wanted to communicate to you our current view of market conditions and the
impact these conditions will have on our reported results in the second
quarter, as well as our current view of the third quarter.

You will recall in last quarter's earnings call, we guided you to low- to
mid-single digit revenue growth for second quarter, 27-28 percent gross margin,
and low-to-mid-single digit expense growth.

As we said then, our guidance assumed no further deterioration in the U.S.
economy, no significant slowdown internationally and relatively stable foreign
exchange rates. We indicated visibility was limited and there were risks
inherent in these assumptions. Unfortunately, our concerns were warranted.

Our consumer business has seen significant deterioration during the quarter. In
fact, we are currently 15 growth points below plan in the consumer business
after two months. Consumer IT spending continues to be weak in the U.S., and now
deterioration has spread to other regions of the world, particularly Europe and
to a lesser degree Asia Pacific.



We've been watching European PC market data carefully. Recent data suggests
that, while home PC unit shipments in Europe were strong throughout 2000,
those gains evaporated in the first quarter with growth in home PC units flat
year-over-year.

We're clearly feeling the impact of this sudden shift in consumer IT buying
sentiment. Our European consumer business overall is significantly under plan.

In this challenging environment, we're managing our inkjet business to
strategically hold share, which is important as we move aggressively into the
low-end printer market. We're simply not willing to relinquish any ground in
this market and we're intent on aggressively protecting and growing our
consumables franchise. On the other hand, we're approaching the PC market on
the basis of pursuing profitability versus share growth. There simply isn't
the back-end recurring revenue stream in this business that warrants
sacrificing product profits.

As for the enterprise market, the tone overseas has changed as well. In my
trips to Europe in late January and February, I found our enterprise
customers to be cautiously optimistic. Over the past several weeks, I have
seen a distinct change in their outlook, with increased concern surrounding
the global economic climate and far more cautious attitudes toward spending
in all areas of their businesses. This suggests the European slowdown is
mirroring the pattern we saw in the U.S. - growing softness in the retail
sector and increasingly competitive pricing moves followed by a more subtle
but just as meaningful slowdown in the enterprise space.



Even in this difficult climate, on a global basis, we're seeing slight
improvement in our enterprise business over the first quarter. In contrast
with the increasing weakness in the consumer market, revenues from our
enterprise business are expected to be flat or up slightly on a sequential
basis.

As a result of all of these factors, we now expect second quarter revenues to
be down two to four percent both sequentially and as compared with the
year-ago quarter. These numbers also reflect a continued adverse currency
impact - roughly 4 percent on the top-line year-over-year - as currency
improvements did not materialize as widely anticipated.

We expect gross margin to be between 25 and 26 percent. One point of this
shortfall is due to inkjet, PDA and imaging inventory write-downs in our
consumer business totaling approximately $100 million, along with $50 million
of write-offs related to the cancellation of planned inkjet production line
expansion.

Both of these items are non-recurring and are included in our EPS estimates.

Expense growth remains in the low to- mid- single digits. And other income
appears to be in the range of $60 million. Therefore, we now expect EPS in
the range of 13 to 17 cents for the quarter.

Moving on to our view of the third quarter, while visibility remains limited,
our current view calls for flat revenues compared to the year prior, with
gross margin trending up due to several factors. First, as I mentioned
earlier, inventory and capacity write-downs hurt gross margin by one point in
the second quarter. Again, these are non-recurring items. Second,



the weak yen will have a favorable effect on Laserjet component costs. Third,
our new Laserjet products will help overall margin in our imaging and
printing business. Of course, offsetting these factors will be continued
pricing pressure in all of our businesses due to the tough, highly
competitive economic environment.

In this environment, we're staying focused on our strategy and working hard
to continue to achieve the right balance between adjusting costs and expenses
downward to address current business conditions, while at the same time
making the necessary investments to assure that we come out of this slowdown
strong and well positioned.

We're going to continue to be aggressive on cost and expense management, but
we will not sacrifice our long-term success. For example, we are continuing
to grow R&D spending and we are continuing to hire selectively to refresh our
talent pool.

Recognizing employees' contributions is particularly important in tough
times. While we delayed planned salary increases in the first quarter by 90
days, we will not delay these increases further. Additionally, while no
employee bonuses will be paid based on first half performance, we are
planning for some payout in the second half.

To compensate for these decisions and to calibrate expenses to lower revenue
levels, we are taking a range of additional actions. This includes
maintaining tight control of discretionary spending. We're also requiring
employees to take six incremental days off between now and year-end. And we
have a program underway to reduce management cost



structures and improve management span of control. Within 60 days, we will
identify up to 3,000 management positions that will be eliminated.

In closing, we remain confident that our strategy is the right one. We believe
that we will emerge from this downturn a more aggressive and focused competitor.

With that, now Bob and I will take a few questions ... keep in mind that this
isn't a quarter-end report and we're not going to provide the same amount of
detail as a normal earnings call ...

                                      # # #

FORWARD-LOOKING STATEMENTS

This script contains forward-looking statements that involve risks and
uncertainties, as well as assumptions that, if they never 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. All statements other than statements of
historical fact are statements that may be deemed forward-looking statements,
including any projections of earnings, revenues, or other financial items;
any statements of the plans, strategies, and objectives of management for
future operations; any statements concerning proposed products, services, or
developments; any statements regarding future economic conditions or
performance; statements of belief and any statement of assumptions underlying
any of the foregoing. The risks, uncertainties and assumptions referred to
above include the ability of HP to retain and motivate key employees; the
timely development, production and acceptance of products and services and
their feature sets; the challenge of managing asset levels, including
inventory; the flow of products into third-party distribution channels; the
difficulty of keeping expense growth at modest levels while increasing
revenues; and other risks that are described from time to time in HP's
Securities and Exchange Commission reports, including but not limited to the
annual report on Form 10-K for the year ended Oct. 31, 2000, and subsequently
filed reports. HP assumes no obligation to update these forward-looking
statements.