UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

For the transition period from                             to                              

Commission file number 1-4423

HEWLETT-PACKARD COMPANY
(Exact name of registrant as specified in its charter)

        Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act") during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý    No o

        Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ý    Accelerated filer o    Non-accelerated filer o

        Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act) Yes o    No ý

        The number of shares of HP common stock outstanding as of February 28,May 31, 2006 was 2,828,423,3882,789,556,593 shares.

HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
INDEX

Forward-Looking Statements

        This Quarterly Report on Form 10-Q, including "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Item 2 of Part I of this report, contains forward-looking statements that involve risks, uncertainties and assumptions. If the risks or uncertainties ever materialize or the assumptions prove incorrect, the results of Hewlett-Packard Company and its consolidated subsidiaries ("HP") may 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 any projections of revenue, margins, expenses, tax provisions, earnings, cash flows, benefit obligations, share repurchases or other financial items; any statements of the plans, strategies and objectives of management for future operations, including the execution of restructuring plans; any statements concerning expected development, performance or market share relating to products or services; any statements regarding future economic conditions or performance; any statements regarding pending investigations, claims or disputes; any statements of expectation or belief; and any statements of assumptions underlying any of the foregoing. Risks, uncertainties and assumptions include macroeconomic and geopolitical trends and events; the execution and performance of contracts by customers, suppliers and partners; the challenge of managing asset levels, including inventory; the difficulty of aligning expense levels with revenue changes; assumptions related to pension and other post-retirement costs; expectations and assumptions relating to the execution and timing of workforce restructuring programs; the outcome of pending legislation and accounting pronouncements; and other risks that are described herein, including but not limited to the items discussed in "Factors that Could Affect Future Results" set forth in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Item 2 of Part I of this report, and that are otherwise described from time to time in HP's Securities and Exchange Commission reports filed after this report. HP assumes no obligation and does not intend to update these forward-looking statements.

PART I

Item 1. Financial Statements.

HEWLETT-PACKARD COMPANY AND SUBSIDIARIES

Consolidated Condensed Statements of Earnings

(Unaudited)

⁽¹⁾

Costs and expenses for the three and six months ended January 31,April 30, 2006 include SFAS 123R stock-based compensation expense. See Note 2 to the Consolidated Condensed Financial Statements for additional information.

⁽²⁾

Provision(Benefit from) provision for taxes includes income tax benefit from stock-based compensation.

The accompanying notes are an integral part of these Consolidated Condensed Financial Statements.

HEWLETT-PACKARD COMPANY AND SUBSIDIARIES

Consolidated Condensed Balance Sheets

The accompanying notes are an integral part of these Consolidated Condensed Financial Statements.

HEWLETT-PACKARD COMPANY AND SUBSIDIARIES

Consolidated Condensed Statements of Cash Flows

(Unaudited)

The accompanying notes are an integral part of these Consolidated Condensed Financial Statements.

HEWLETT-PACKARD COMPANY AND SUBSIDIARIES

Notes to Consolidated Condensed Financial Statements

(Unaudited)

Note 1: Basis of Presentation and Significant Accounting Policies

        In the opinion of management, the accompanying Consolidated Condensed Financial Statements of Hewlett-Packard Company and its consolidated subsidiaries ("HP") contain all adjustments, including normal recurring adjustments, necessary to present fairly HP's financial position as of January 31,April 30, 2006, and its results of operations for the three and six months ended April 30, 2006 and 2005, and its cash flows for the threesix months ended January 31,April 30, 2006 and 2005. The Consolidated Condensed Balance Sheet as of October 31, 2005 is derived from the October 31, 2005 audited financial statements. Certain reclassifications have been made to prior year amounts in order to conform to the current year presentation.

        The results of operations for the three and six months ended January 31,April 30, 2006 are not necessarily indicative of the results to be expected for the full year. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Quantitative and Qualitative Disclosures About Market Risk" and the Consolidated Financial Statements and notes thereto included in Items 7, 7A and 8, respectively, of the Hewlett-Packard Company Annual Report on Form 10-K for the fiscal year ended October 31, 2005.

        The preparation of financial statements in accordance with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in HP's Consolidated Condensed Financial Statements and accompanying notes. Actual results could differ materially from those estimates.

Stock-Based Compensation

        Effective November 1, 2005, HP adopted the fair value recognition provisions of Statement of Financial Accounting Standards ("SFAS") No. 123 (revised 2004), "Share-Based Payment" ("SFAS 123R"), using the modified prospective transition method and therefore has not restated results for prior periods. Under this transition method, stock-based compensation expense for the first quarter of fiscalthree and six months ended April 30, 2006 includes compensation expense for all stock-based compensation awards granted prior to, but not yet vested as of November 1, 2005, based on the grant dategrant-date fair value estimated in accordance with the original provision of SFAS No. 123, "Accounting for Stock-Based Compensation" ("SFAS 123"). Stock-based compensation expense for all stock-based compensation awards granted after November 1, 2005 is based on the grant-date fair value estimated in accordance with the provisions of SFAS 123R. HP recognizes these compensation costs on a straight-line basis over the requisite service period of the award, which is generally the option vesting term of four years. Prior to the adoption of SFAS 123R, HP recognized stock-based compensation expense in accordance with Accounting Principles Board ("APB") Opinion No. 25, "Accounting for Stock Issued to Employees" ("APB 25"). In March 2005, the Securities and Exchange Commission (the "SEC") issued Staff Accounting Bulletin No. 107 ("SAB 107") regarding the SEC's interpretation of SFAS 123R and the valuation of share-based payments for public companies. HP has applied the provisions of SAB 107 in its adoption of SFAS 123R. See Note 2 to the Consolidated Condensed Financial Statements for a further discussion on stock-based compensation.

Recent Pronouncements

        There have been no material changes to the recent pronouncements as previously reported in HP's Annual Report on Form 10-K for the fiscal year ended October 31, 2005.

Note 2: Stock-Based Compensation

        At January 31,April 30, 2006, HP has the following stock-based employee compensation plans as described below. The total compensation expense related to these plans was $144$124 million and $268 million, respectively, for the three and six months ended January 31,April 30, 2006. Prior to November 1, 2005, HP accounted for those plans under the recognition and measurement provisions of APB 25. Accordingly, HP generally recognized compensation expense only when it granted options with a discounted exercise price. Any resulting compensation expense was recognized ratably over the associated service period, which was generally the option vesting term.

        Prior to November 1, 2005, HP provided pro forma disclosure amounts in accordance with SFAS No. 148, "Accounting for Stock-Based Compensation—Transition and Disclosure" ("SFAS 148"), as if the fair value method defined by SFAS 123 had been applied to its stock-based compensation.

        Effective November 1, 2005, HP adopted the fair value recognition provisions of SFAS 123R, using the modified prospective transition method and therefore has not restated prior periods' results. Under this transition method, stock-based compensation expense for the first quartersix months of fiscal 2006 included compensation expense for all stock-based compensation awards granted prior to, but not yet vested as of, November 1, 2005, based on the grant dategrant-date fair value estimated in accordance with the original provisions of SFAS 123. Stock-based compensation expense for all share-based payment awards granted after November 1, 2005 is based on the grant-date fair value estimated in accordance with the provisions of SFAS 123R. HP recognizes these compensation costs net of aan estimated forfeiture rate and recognizes the compensation costs for only those shares expected to vest on a straight-line basis over the requisite service period of the award, which is generally the option vesting term of four years. HP estimated the forfeiture rate for the first quartersix months of fiscal 2006 based on its historical experience during the preceding four fiscal years.

        As a result of adopting SFAS 123R, the impact to the Consolidated Condensed Financial Statementsincome before income taxes for the three and six months ended January 31,April 30, 2006 for income before income taxeswas $103 million and $222 million lower, respectively, and net income for the three and six months ended January 31,April 30, 2006 was $119$70 million and $85$155 million lower, respectively, than if we had continued to account for stock-based compensation under APB 25. The impact on both basic and diluted earnings per share for the three months ended January 31,April 30, 2006 was $0.03$0.02 per share.share and the impact on basic and diluted earnings per share for the six months ended April 30, 2006 was $0.06 per share and $0.05 per share, respectively. In addition, prior to the adoption of SFAS 123R, HP presented the tax benefit of stock option exercises as operating cash flows. Upon the adoption of SFAS 123R, tax benefits resulting from tax deductions in excess of the tax benefit related to compensation cost recognized for those options are classified as financing cash flows.

        The pro forma table below reflects net earnings and basic and diluted net earnings per share for the first quarter of fiscalthree and six months ended April 30, 2005, had HP applied the fair value recognition provisions of SFAS 123, as follows:

Employee Stock Purchase Plan

        HP sponsors the Hewlett-Packard Company 2000 Employee Stock Purchase Plan, also known as the Share Ownership Plan (the "ESPP"), pursuant to which eligible employees may contribute up to 10% of base compensation, subject to certain income limits, to purchase shares of HP's common stock. Prior to November 1, 2005, employees were able to purchase stock semi-annually at a price equal to 85% of the fair market value at certain plan-defined dates. As of November 1, 2005, HP changed the ESPP such that employees will purchase stock semi-annually at a price equal to 85% of the fair market value on the purchase date. Since the price of the shares is now determined at the purchase date and there is no longer a look-back period, HP recognizes the expense based on the 15% discount at purchase. For the first quarter of fiscalthree and six months ended April 30, 2006, ESPP compensation expense was $18$7 million and $25 million, net of tax.tax, respectively.

Incentive Compensation Plans

        HP stock option plans include principal plans adopted in 2004, 2000, 1995 and 1990 ("principal option plans"), as well as various stock option plans assumed through acquisitions under which stock options are outstanding. All regular employees were eligible to receive stock options in the first quartersix months of fiscal 2006. Options granted under the principal option plans are generally non-qualified stock options but the principal option plans permit some options granted to qualify as "incentive stock options" under the U.S. Internal Revenue Code. The exercise price of a stock option generally is equal to the fair market value of HP's common stock on the option grant date.grant-date. The contractual term of options granted since fiscal 2003 is generally eight years, while the contractual term of options granted

prior to fiscal 2003 is generally ten years. Under the principal option plans, HP may choose, in certain

cases, to establish a discounted exercise price at no less than 75% of fair market value on the grant date. HP has not granted any discounted options since fiscal 2003.

        Under the principal option plans, HP granted certain employees cash, restricted stock awards, or both. Restricted stock awards are nonvested stock awards that may include grants of restricted stock or grants of restricted stock units. Cash and restricted stock awards are independent of option grants and are generally subject to forfeiture if employment terminates prior to the release of the restrictions. Such awards generally vest one to three years from the date of grant. During that period, ownership of the shares cannot be transferred. Restricted stock has the same cash dividend and voting rights as other common stock and is considered to be currently issued and outstanding. Restricted stock units have dividend equivalent rights equal to the cash dividend paid on restricted stock. Restricted stock units do not have the voting rights of common stock, and the shares underlying the restricted stock units are not considered issued and outstanding. HP expenses the cost of the restricted stock awards, which is determined to be the fair market value of the shares at the date of grant, ratably over the period during which the restrictions lapse.

        In light of new accounting guidance under SFAS 123R, beginning in the second quarter of fiscal 2005 HP reevaluated its assumptions used in estimating the fair value of employee options granted. As part of this assessment, management determined that implied volatility calculated based on actively traded options on HP common stock is a better indicator of expected volatility and future stock price trends than historical volatility. Therefore, expected volatility for the quarterthree and six months ended January 31,April 30, 2006 and 2005 was based on a market-based implied volatility.

        As part of its SFAS 123R adoption, HP also examined its historical pattern of option exercises in an effort to determine if there were any discernable activity patterns based on certain employee populations. From this analysis, HP identified three employee populations. HP used the Black-Scholes option pricing model to value the options for each of the employee populations. The table below presents the weighted average expected life in months of the three identified employee populations. The expected life computation is based on historical exercise patterns and post-vesting termination behavior within each of the three populations identified. The interest rate for periods within the contractual life of the award is based on the U.S. Treasury yield curve in effect at the time of grant.

        The fair value of share-based payment awards was estimated using the Black-Scholes option pricing model with the following assumptions and weighted average fair values as follows:values:

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The fair value calculation was based on stock options granted during the period.

        Option activity under the principal option plans as of January 31,April 30, 2006 and changes during the threesix months ended January 31,April 30, 2006 were as follows:

        The aggregate intrinsic value in the table above represents the total pretaxpre-tax intrinsic value (the difference between HP's closing stock price on the last trading day of the firstsecond quarter of fiscal 2006 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on January 31,April 30, 2006. This amount changes based on the fair market value of HP's stock. Total intrinsic value of options exercised for the three and six months ended January 31,April 30, 2006 was $235 million.$256 million and $491 million, respectively. Total fair value of options vested and expensed for the three and six months ended April 30, 2006 was $67$63 million and $130 million, net of tax, for the three months ended January 31, 2006.respectively.

        As of January 31,April 30, 2006, $909$828 million of total unrecognized compensation cost related to stock options is expected to be recognized over a weighted-average period of 2.822.77 years.

        Cash received from option exercises and purchases under the ESPP for the first three and six months ended January 31,April 30, 2006 was $647 million.$507 million and $1,154 million, respectively. The actual tax benefit realized for the tax deduction from option exercises of the share-based payment awards totaled $105 million for the three and six months ended January 31, 2006.April 30, 2006 totaled $95 million and $200 million, respectively.

        Nonvested restricted stock awards as of January 31,April 30, 2006 and changes during the threesix months ended January 31,April 30, 2006 were as follows:

        As of January 31,April 30, 2006, there was $113$112 million unrecognized stock-based compensation expense related to nonvested restricted stock awards. That cost is expected to be recognized over a weighted-average period of 1.931.88 years.

        In the first three and six months ended April 30, 2006, HP recorded $15 million and $31 million, respectively, of fiscal 2006stock-based compensation expense, net of tax, relating to options assumed through acquisitions and fiscalwith discounted exercise prices. In the three and six months ended April 30, 2005, HP recorded $16$19 million and $11$30 million, respectively, of stock-based compensation expense, net of tax, relating to options assumed through acquisitions and with discounted exercise prices. For the first three and six months ended January 31,April 30, 2006, stock-based compensation expense related to the ESPP and the principal option plans under SFAS 123R was allocated as follows:

Note 3: Net Earnings Per Share ("EPS")

        HP's basic EPS is calculated using net earnings and the weighted-average number of shares outstanding during the reporting period. Diluted EPS includes the effect from potential issuance of common stock, such as stock issuable pursuant to the exercise of stock options and the assumed conversion of convertible notes.

        The reconciliation of the numerators and denominators of the basic and diluted EPS calculations was as follows:

        InFor the firstsecond quarter of fiscal 2006 and 2005, HP excluded options to purchase approximately 223139 million shares and 316466 million shares, respectively, from the calculation of diluted EPS because the effect was antidilutive. For the first six months of fiscal 2006 and 2005, HP excluded options to purchase approximately 184 million shares and 468 million shares, respectively, from the calculation of diluted EPS because the effect was antidilutive. Stock options are antidilutive when the exercise price of the options is greater than the average market price of the common shares for the period.

Note 4: Balance Sheet Details

        Balance sheet details were as follows:

Accounts and Financing Receivables

        HP has revolving trade receivables-based facilities permitting it to sell certain trade receivables to third partiesthird-parties on a non-recourse basis. The aggregate maximum capacity under these programs was approximately $1.2 billion as of January 31,April 30, 2006. The facility with the largest volume is one that is subject to a maximum amount of 525 million euros, or approximately $638$663 million (the "Euro Program"). HP sold trade receivables of approximately $2.1$2.2 billion during the first three monthshalf of fiscal 2006, including approximately $1.4$1.6 billion under the Euro Program. Fees associated with these facilities generally do not differ materially from the cash discounts offered to these customers under the previous alternative prompt payment programs. As of January 31,April 30, 2006, there was approximately $532$509 million available under these programs, of which $386$311 million relatesrelated to the Euro Program.

Inventory

Note 5: Acquisitions

Peregrine

        On December 19, 2005, HP acquired the outstanding shares of Peregrine Systems, Inc. ("Peregrine") in a cash merger for $26.08 per share. The purchase price was approximately $588$489 million, consisting of $442 million of cash paid, which includes direct transaction costs, as well as certain liabilities recorded in connection with the transaction. The acquisition of Peregrine is intended to add key asset and service management components to the HP OpenView portfolio, a distributed management software suite for business operations and IT. In connection with this acquisition, HP recorded approximately $393$294 million of goodwill and $162 million of amortizable intangible assets. HP

also expensed $34 million for in- processin-process research and development ("IPR&D"). HP is amortizing the purchased intangibles, principally customer relationships and developed technology, on a straight-line basis over their estimated useful lives ranging from five to six years.

Other acquisitionsAcquisitions

        HP also completed threefour other acquisitions during the first quartersix months of fiscal 2006. Total consideration for these acquisitions was approximately $267$393 million, which includes direct transaction costs. The largest of these transactions was the acquisition of substantially all of the assets of Scitex Vision Ltd ("Scitex"). The Scitex asset acquisition is expected to expand HP's leadership in printing into the industrial wide-format market.

        HP recorded approximately $67$153 million of goodwill and $130$168 million of purchased intangibles in connection with these other acquisitions. HP also recorded approximately $16$18 million of IPR&D related to these acquisitions in the first quartersix months of fiscal 2006.

        HP has included the results of operations of these transactions prospectively from the respective date of the transaction. HP has not presented the pro forma results of operations of the acquired businesses because the results are not material to HP's results of operations on either an individual or an aggregate basis.

        In February 2006, HP completed its acquisition of OuterBay Technologies, Inc, a private company that sells database archiving software.

Note 6: Goodwill and Purchased Intangible Assets

Goodwill

        Goodwill allocated to HP's business segments as of January 31,April 30, 2006 and changes in the carrying amount of goodwill for the threesix months ended January 31,April 30, 2006 were as follows:

        The goodwill adjustments for acquisitions made, as shown above, relate primarily to revisions of acquisition-related tax estimates for all acquisitions and the reduction of a restructuring liability associated with fiscal 2002 and 2001 restructuring plans of Compaq Computer Corporation ("Compaq") prior to its acquisition by HP. These reductions resulted from adjusting original estimates to actual costs incurred at various locations throughout the world.

Purchased Intangible Assets

        HP's purchased intangible assets associated with completed acquisitions are composed of:

        Estimated future amortization expense related to finite-lived purchased intangible assets at January 31,April 30, 2006 is as follows:

Note 7: Restructuring Charges and Workforce Rebalancing

Fiscal 2005 Restructuring Plans

        In the fourth quarter of fiscal 2005, HP's Board of Directors approved a restructuring plan recommended by its chief executive officer and senior management that was designed to simplify HP's structure, reduce costs and place greater focus on its customers. Under the plan, approximately 15,300 employees leftpositions have been eliminated or are expected to leave HPbe eliminated through the first quarter of fiscal 2007. The initial charge for these actions totaled $1.6 billion. HP expects to record an additional charge of $20$13 million in connection with this plan. DuringFor the three and six months ended January 31,April 30, 2006, HP recognized $10charges of approximately $20 million in chargesand $30 million, respectively, relating to employee severance and other benefits charges. During the second quarter and first six months of fiscal 2006, these charges were offset by a $13$4 million and a $17 million curtailment gain, respectively, from the U.S. retiree medical program.program, and a $37 million settlement gain from the U.S. pension plans.

        The fourth quarter charge includesincluded approximately $400 million related to employee severance and other benefits associated with the early retirement of 3,200 U.S. employees who left HP by

October 31, 2005. The majority of these costs will bewere funded by HP's pension plan assets. The remaining charges of approximately $1.2 billion, which include approximately $100 million of non-cash stock compensation, arewere related to severance and other benefits for 11,80012,000 employees. Pursuant to the plan, approximately 6,500 employees left HP1,600 positions were eliminated during the quarter, bringing the total to 8,100 as of January 31,April 30, 2006, and the remaining 8,500 employees,majority of the 7,100 positions, as well as an additional 300 employees,100 positions for which the accrual criteria have not been met as of January 31,April 30, 2006, are expected to leave throughbe eliminated by the first quarterend of fiscal 2007.2006. HP expects to pay out the majority of the costs relating to severance and other employee benefits duringbefore the end of fiscal 2006.2007.

        In the third quarter of fiscal 2005, HP's management approved a restructuring plan, and HP recorded restructuring charges of $109 million related to severance and related costs associated with the termination of approximately 1,450 employees, all of whom left HP as of October 31, 2005. Of the initial restructuring amount, HP has paid substantially all of it as of January 31,April 30, 2006.

Fiscal 2005 Workforce Rebalancing

        In addition to the restructuring activities described above, HP incurred approximately $60$177 million duringand $236 million, respectively, for the fiscal quarter of fiscal 2005 in workforce rebalancing charges resulting from actions taken by certain business segments for severancethree and related costs. Workforce rebalancing costs are included in

the segment results. During the six months ended April 30, 2005, HP recorded $236 million ofin workforce rebalancing charges within certain business segments, primarily for severance and related costs. As a result of these workforce rebalancing actions, approximately 3,000 employees left HP as of October 31, 2005. HP expects to pay out the remaining severance and other employee benefits of $18 million during fiscal 2006.

Fiscal 2003 Restructuring Plans

        During fiscal 2003, HP's management approvedIn the three and implemented plans to restructure certainsix months ended April 30, 2006, HP recorded adjustments of its operations with the intent of better managing HP's cost structure and aligning certain of its operations more effectively with then current business conditions. The initial charge for these actions totaled $752$7 million and included $639$2 million, relatedrespectively, to reduce severance and other employee benefits for workforce reductions, $42 million for vacating duplicative facilities (leased or owned) and contract termination costs, and asset impairments of $71 million associated with the identification of duplicative assets and facilities (leased or owned) related to the acquisition of Compaq. In the first quarter ended January 31, 2006, HP recorded $5 million in additional restructuring charges. These charges pertained to other related restructuring adjustments to the fiscal 2003 restructuring plans.

        HP included original estimates of 9,000 employees across many regions and job classes in the fiscal 2003 workforce reduction plans. Subsequent to the initial estimate, HP reduced the number of employees to be terminated under the fiscal 2003 restructuring plans by 600 employees. As of January 31, 2006, substantially all of the 8,400 employees had been terminated, had been placed in workforce reduction programs or had retired. HP expects to pay out the majority of the remaining severance and other employee benefits of $11$9 million during fiscal 2006. HP anticipates the remaining costs of vacating duplicative facilities of $12$5 million to be substantially settled by the end of fiscal 2006.

Fiscal 2002 and 2001 Restructuring Plans

        On May 3, 2002, HP acquired Compaq. At that time, both HP and Compaq had restructuring liabilities for 2001 restructuring plans, of which $3 million and $48 million, respectively, remained at January 31, 2006. Restructuring plans established in 2002 in connection with the Compaq acquisition resulted in additional restructuring liabilities aggregating $2.8 billion. Of this amount, HP recorded an aggregate $1.9 billion as restructuring charges during fiscal 2002, 2003 and 2004, while HP recorded $960 million as of the acquisition date as part of the Compaq purchase price allocation. At January 31, 2006, the remaining restructuring liabilities for the HP- and Compaq-related 2002 restructuring plans were $8 million and $61 million, respectively. The 2001 and 2002 restructuring plans are substantially complete, although HP records minor revisions to previous estimates as necessary. In the first quarterthree and six months ended January 31,April 30, 2006, HP recorded additional adjustments of $13$14 million additional restructuring charges.and $27 million, respectively. These chargesadjustments pertained to severance and other related restructuring adjustments to the fiscal 2002 and 2001 restructuring plans.adjustments. In addition, an adjustment for the threesix months ended January 31,April 30, 2006 includes a $10$14 million reduction of goodwill pertaining to severance and other related restructuring true-ups. The aggregate $120$117 million restructuring liability on these plans as of January 31,April 30, 2006 relates primarily to facility lease obligations.obligations and severance. HP expects to pay out these obligations over the life of the related obligations, which extend to the end of fiscal 2010.

Summary of Restructuring Plans

        The activity in the accrued restructuring balances related to all of the plans described above for the three and six months ended January 31,April 30, 2006 was as follows:

        At January 31, 2006 and October 31, 2005, HP included the long-term portion of the restructuring liability of $71 million and $73 million, respectively, in Other Liabilities in the accompanying Consolidated Condensed Balance Sheets.