Failure pattern · United States · 2011–2024
HP and Autonomy: an $11 billion deal and an $8.8 billion write-down
HP paid about $11.1 billion for British software company Autonomy. A year later it wrote down $8.8 billion, alleging accounting improprieties, and spent over a decade in court.
By Shivam Bhandari · Reviewed 31 October 2026 · How we write
by the numbers
- Price paid (2011)
- about $11.1 billion
- Write-down (2012)
- $8.8 billion
- Attributed to alleged improprieties
- over $5 billion
What happened
In August 2011 HP's new CEO Léo Apothéker announced a shift away from PCs toward software, including buying Autonomy, a UK enterprise-search company, for about $11.1 billion — a large premium. Investors reacted badly, and Apothéker was replaced within weeks.
In November 2012 HP wrote down $8.8 billion of the deal's value, saying more than $5 billion related to accounting improprieties and misrepresentations at Autonomy before the sale. Autonomy's founders denied wrongdoing and argued HP mismanaged the business.
A UK High Court ruled largely in HP's favour in a civil case in 2022, while a US jury acquitted Autonomy founder Mike Lynch of criminal fraud charges in 2024. The deal became a classic example of acquisition due-diligence failure.
Timeline
- 2011
Deal announced (August); CEO replaced (September).
- 2012
$8.8 billion write-down.
- 2022
UK civil court rules largely for HP.
- 2024
US jury acquits Lynch of criminal charges.
what went wrong
- Paid a large premium during a rushed strategic shift.
- Due diligence failed to verify revenue quality.
- Leadership change left the deal without its sponsor.
the lesson
A big acquisition to change strategy overnight is high-risk — verify the quality of revenue, not just its size.
Apply it to your business
- 1Do deep diligence on how revenue is recognised.
- 2Beware of premiums driven by urgency.
- 3Make sure leadership is committed long-term to the deal.
Laws at work in this story
Figures are rounded and drawn from public reports, company filings and widely cited coverage at the time. Check the company's latest filings before relying on any number.