1. © 2008 Hewlett-Packard Development Company, L.P. The information contained herein is subject to change without notice ESS Business Interlocks 2H08’ PCA ABC Cost Update Foxconn Thomas Chiang Oct5 th 2008 HP Restricted

2. September Achievements : No cost reductions versus August −ODM : Achieved saving $4.08M, 45% for $9.12M of total saving opportunity −CM : Achieved savings $0.76M, 22% for $3.M of total saving opportunity October Progress −Foxconn has finished supplier QBR meeting leading to cost reduction. HP received ABC cost reduction updated (around $500k to $1M) Real saving for QBR will be communicated during Nov interlock meeting −HP has finalized LOA worth $772k Foxconn has updated cut-in date (ETA 10/24) −1HFY09 ABC wave: plan to submit ODM quotes to CDP on 10/27 −Foxconn responsiveness not as fast as usual. Resource issue? Executive Summary 

3. ABC Target to In Quote & Future Saving PotentialIn Quotes Next month in quote Future Savings 1st Month100%10% 2nd Month100%20%10% 3rd Month100%30%10% 4th Month100%45%10% 5th Month100%55%10% 6th Month100%65%5%10%

4. September ABC Achieved for ODM Sustaining 4 [7/7/2008] – HP Restricted Achieved savings $4.07M (45%) – bellow goal In quote: $4.07M (45%) Future saving: $0.0M WIP $3.3M (36%)

5. Foxconn ODM on Top 20 Saving Components LOA StatusFoxconn LOA in progress$517,769 LOA Approved$1,511,004 LOA Denied$158,248 Component Number DescriptionSupplier NameFoxconn Price ABC target price Foxconn Achieved saving ABC saving delta 6010B0033701CAPACITOR-AL-SP,47uF,16V,M,-40~+105C,DX2SDK0.3800.2910$253,535 220100M00-413-NPLD,EPM570F256C5RR,304MHz,3.3V,FBGA,256P,NALTERA4.5602.3000$183,204 6010B0011401CAPACITOR-AL-SP,220uF,2.5V,M,-40~+105C,DSDK0.2400.1850$130,566 6015A0064201TRAN-NEMOS-30V-55A-DirectFET-TRIR0.3720.3200$123,444 6010A0056801CAP-AL-SP-150MFD-6.3V-M-105C-DX2.8-SMD-TPANASONIC0.4370.3100$105,114 6010B0022401CAPACITOR-CHIP,4.7uF,6.3V,K,X5R,0603,TRMURATA0.0310.0090$94,009 21-32000001-00- G IC, ProASIC 3 Flash Family FPGA, 100pin, VQFPACTEL12.7604.300091,876 6010A0052302CAP-AL-SP-330MFD-2V-M-105C-Dx2.8-SMD-TAPSDK0.4470.2700$84,037 6019B0043501IC,PWM CONTROLLER,0.8V,1GHZ,SOT23,5P,TRNATIONAL0.8290.4900$80,476 6013A0117801RES-M/F-0.003-1%-3W-4T-TAPVishay0.4970.3900$76,203 10-642449-001-G Amphenol RADSOK/RADSERT 3.6MM Size 8, Press-fit Power receptacle Amphenol4.0002.490065,594 6019A0170001IC-REGULATOR-ADJ-1.25_13.8V-TO252-3P-TRON SEMICON0.3560.1000$60,772 75848-7104-GHDR,GBX,2PR,10POS GUIDE RT,RoHSMOLEX6.2605.870033,883 210202600-031-GIC, PCA9555, 16bit I2C and SMB IO Port with Interrupt, 24pin, SSOPNXP1.0790.480032,537 210805U00-031-G IC, Hi-Speed Universal Serial Bus PCI Host Controller, ISP1564, LQFP100 NXP3.4962.100030,321 6018B0011601OSCILLATOR,125MHz,+/-50PPM,SMD,7X5,TREpson3.6503.2500$23,739 6019B0249701IC,CPL DEVICE,3.3V,212IO,FBGA,256P,TALTERA3.7503.5000$23,739 310800700-031-GLogicIC,Counter,74LV165DB,1.0V~5.5V,115ns,SSOP,16P,GNXP0.2000.090020,152 34040B300-085-GCONN, RJ45 W/MAG & W GRN LEDSBEL FUSE1.0400.850017,404 310202K00-185-GLogicIC,Trigger,74LCX573MTCX_NL,2.0V~3.6V,7ns,TSSOP,20P,GFAIRCHILD0.1580.095017,313 LOA parts

6. September 08’ABC Achieved for CM Sustaining 6 [7/7/2008] – HP Restricted Achieved savings $0.76M (22%) – below goal In quote: $0.76M (22%) Future saving: $0.0M WIP $2.0M (57%)

7. Foxconn CM on Top 20 saving components LOA StatusTotal LOA Approved6,640 ILOA in progress1,880,040 LOA parts Component Number DescriptionSupplier NameFoxconn Price HP target price Foxconn achieved saving ABC saving delta 342427-002CAP, SM,220UF,20%,2V,ALUM POLYMERPANASONIC0.2770.0666,080$426,892 413585-501CONN, 2.4 MM RADSOK, PRESS FIT,RoHSAMPHENOL3.1201.7800$358,139 351168-515HDR, GBX,5PR,10POS W/2 GUIDE,RoHSMOLEX6.1345.87019,243$282,235 351168-910HDR,GBX,2PR,25POS OPEN,RoHSMOLEX4.5684.38012,027$125,616 335558-001CAP, 560UF,20%,4v,7mOHM,8X11.5SANYO0.1030.09044,922$82,784 413072-601 HDR, SMT,SHRD,2R,30P,0.050C,AMPHNOL,RoHS AMPHENOL1.6001.2500$70,158 204109-501XSTR, SM,DGTL,N-FET,25V,303N,RoHSFAIRCHILD0.0300.0080$53,433 389207-002SCKT, uP, LGA-771PFOXCONN2.4092.34961,337$40,666 229024-501IC, FEPROM,4MX8/2MX16,3V,TSOP,RoHSSPANSION1.3001.250135,103$33,776 262366-014XTAL, SM,OSC,3V,66.67MHz,45/55AVX0.5880.5001,351$29,723 347237-006CAP, SM, 22uF, 4V, 20%, X6S, 20%, 0805MURATA0.0430.03810,808$28,210 377255-501CONN, RCPT,150POS,RA,AIRMAX,PF,RoHSFCI6.8605.6700$27,246 413072-602 HDR, SMT,SHRD,2R,50P,0.050C,AMPHNOL,RoHS AMPHENOL1.8401.4700$24,722 457261-501CONN, C/E,.0.1 CENTER,64P,RoHSFCI1.8200.8000$23,354 220490-501DIODE, SM,SHTKY,0.5A,20V,RoHSON SEMICON0.0200.0080$20,215 278757-002CNET, SM,100nF,16V,20%,X7R,4CYAGEO0.0350.0162,027$19,658 396338-001RNET, SM, 22 OHM, 4RES, 5%, 0402KOA0.0040.0030$7,038 160411-515CONN, RJ45 MAG and GRN LEDS,RoHSBEL FUSE0.8700.85013,375$6,890 139708-850RES, SM,0.499 OHM,1%,1/16W,0603,RoHSYAGEO0.0280.0120$1,969 342426-001INDT, SM,4.7uH SHLDED,25%,80mA,0805TDK0.0290.01574$1,834

8. 8 [7/7/2008] – HP Restricted No future saving committed since last Interlock negotiations. No change versus last month. Opportunity : Foxconn has driven cost reduction during supplier QBR ABC progress will be reflected in Novvember Foxconn will confirm new price cut-in date for LOA approved parts Cost Cut-in schedule  Today

9. September 08’ABC Achieved for NPI program Saving Opportunity: $1.8M from NPI programs (BL495 G5 Nitrogen) Achieved savings (Cost Avoidance): $0.0 M from NPI WIP $1.6M for NPI programs. Open Opportunity $0.2M (5%) Not obtainable $0.0 M (0%) BL 495 G5 will be included sustaining program for ABC 1HFY09’

10. Back up slides

11. [7/7/2008] – HP Restricted 11 Achieved saving by product on sustaining programs `ProgramsFamilyAssembly Number Saving per Unit $ (compare with May 08 quote) Total Savings on Product (based on estimated annual volume) $ Normandy MLBBL460c-G1436645-001 8.8 2,083,210 Memphis SPDL385-G5446771-001 21.7 1,583,153 MemphisDL385-G2406565-001 15.7 295,671 Normandy SASBL460c-G1407458-001 0.6 111,160 Shorty BLc3000 0.1 2851 MerlinDL380G5 4.7762,325

12. Analysis of Achieved Savings 12 [7/7/2008] – HP Restricted Cost Saving (sustaining products): $4.8M 94% Foxconn Negotiated 5% HP pass down price

13. Analysis of Saving for Not Obtainable Not Obtainable on sustaining product $0.8M Total $0.8M are not obtainable. 45% Foxconn cost closed 32% Data source inconsistencies 16% Freight cost 6% Assurance of Supply 0.2% No more demand