press release

HP and Red Hat Expand Relationship to Deliver Linux Solutions to Enterprise Customers

HP First to Deploy Red Hat Linux Advanced Server on Intel® Itanium® 2-based Systems

PALO ALTO, Calif., June 18, 2002

HP (NYSE:HPQ) and Red Hat (Nasdaq:RHAT) today announced an expansion of their relationship with the availability of Red Hat Linux Advanced Server on HP servers and workstations for enterprise customers. This availability includes new systems based on the forthcoming Intel® Itanium® 2 processor, making HP the first company to offer Red Hat Linux Advanced Server fully integrated on Itanium 2-based platforms.

As part of the expanded relationship, all HP ProLiant servers, blade servers and Itanium 2-based servers and workstations will be available with certified Red Hat Linux Advanced Server, delivering outstanding price to performance ratios to enterprise customers. HP co-developed the Itanium instruction set architecture and expects to be the first vendor to offer Linux-based servers and workstations based on the Itanium 2 processor. HP and Red Hat will continue collaborating on the research, development and marketing of future Linux solutions.

These new systems will leverage the enterprise functionality of Red Hat Linux advanced technologies and the scalability and performance of the Intel Itanium processor family, which are important considerations for independent software vendors looking to bring their applications to industry-standard platforms.

"It's clear that Linux is gaining ground with commercial applications, and HP is working with Red Hat because of its market leadership among Linux distributions, " said Peter Blackmore, executive vice president, HP Enterprise Systems Group. "Our expanded relationship with Red Hat will significantly broaden the scope of our Linux offerings, providing customers with an even greater opportunity to take advantage of the low cost, reliability and scalability provided by Linux."

"The market acceptance of Red Hat Linux Advanced Server now brings world-class solutions to the enterprise," said Mike Evans, vice president, Business Development, Red Hat. "This announcement solidifies our already-existing relationship with the new HP and represents further validation of Red Hat's enterprise technologies, the first of which is Red Hat Linux Advanced Server."

Enterprise Adoption of Linux Accelerating

"The Linux industry continues to expand, with most of the unit growth in 2001 coming from Linux client and workstation operating system shipments," said Al Gillen, research director, system software, IDC. "IDC's expectation for Linux server operating environment new license revenue shipments remains strong, with forecasts calling for a 19.7 percent compound annual growth rate through 2006."

According to Q1 2002 numbers from IDC, HP ProLiant servers continue to lead the market in Linux Standard Intel Architecture Server unit shipments with 25.9 percent market share. The Q1 results mark the 17th straight quarter in which ProLiant servers have led the industry in worldwide Linux server unit shipments.⁽¹⁾

World-class enterprises, including market leaders Reuters and Amazon, have turned to Red Hat Linux running on HP servers.

"Our customers see Reuters Market Data Systems on HP ProLiant servers running Red Hat Linux as an important way to reduce their costs of operation and improve their service, so it was quite natural that we should bring the two together. The support Linux enjoys from a broad range of hardware vendors also makes it an excellent fit with Reuters' policy of open systems," said Mike Sayers, chief technology officer, Reuters. "We are pleased to bring the Linux version of RMDS to market first on the HP, Intel and Red Hat platform.

"Working with these industry leaders will ensure that RMDS on Red Hat Linux provides the stability, performance and integrity that our customers have come to expect from us."

More information on HP's Linux initiatives is available at http://www.hp.com/linux and +1 888 HP-LINUX.

About Red Hat

Red Hat is the world's premier open source and Linux provider. Red Hat is headquartered in Raleigh, N.C., and has offices worldwide. Please visit Red Hat on the Web at http://www.redhat.com.

About HP

HP is a leading global provider of products, technologies, solutions and services to consumers and businesses. The company's offerings span IT infrastructure, personal computing and access devices, global services and imaging and printing. HP merged with Compaq Computer Corp. on May 3, 2002. The merged company had combined revenue of approximately $81.7 billion in fiscal 2001 and operations in more than 160 countries. More information about HP is available at http://www.hp.com.

⁽¹⁾ International Data Corporation, Quarterly Server Tracker, published May 31, 2002.

Intel and Itanium are trademarks or registered trademarks of Intel Corporation or its subsidiaries in the United States and other countries.

LINUX is a trademark of Linus Torvalds. RED HAT is a registered trademark of Red Hat, Inc.

This news release 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 could 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 new 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 employee management issues; 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 HP's annual report on Form 10-K, as amended on January 30, 2002, for the fiscal year ended October 31, 2001, HP's quarterly report on Form 10-Q for the quarter ended January 31, 2002 (as filed with the SEC on March 12, 2002) and subsequently filed reports. HP assumes no obligation and does not intend to update these forward-looking statements.