Hewlett-Packard Co may spin off the world's largest PC business, part of a wrenching series of moves away from the consumer market, including killing its new tablet and buying British software company Autonomy Corp for as much as $11.7 billion.

The moves underscore the problems plaguing personal computers and devices, HP's core business, and a decade-long search for direction by the original Silicon Valley garage startup, whose "HP Way" was once a model for businesses.

The iconic company associated with the birth of Silicon Valley also plans to kill WebOS-based phones and the TouchPad tablet, which was launched in June but has failed to excite consumers.

HP's third-largest acquisition ever and its potential departure from the PC arena sets in motion a transformation that recalls International Business Machine Corp's overhaul of the last decade.

The barrage of news, which forced HP to announce third-quarter earnings an hour early on Thursday, masked a sharp reduction in HP's estimates for full-year revenue and earnings that sent its shares down 6.1 percent to a 52-week low. They slid another 10 percent to $26.61 in after-hours trading.

HP chief executive Leo Apotheker is responding to mounting pressure to fire up growth just as global economic and tech-spending outlooks darken. Like other PC makers, it is struggling to come up with an answer to Apple Inc's iPhones and iPads, which are gobbling up PC market share.

"HP is at a critical point in its existence and these changes are fundamental to the success we all want," Apotheker told analysts on a conference call.

The announcement is the second this week to show how quickly technology companies are transforming as they jockey for position to cope with radical changes in consumer demand. Google announced on Monday it was buying mobile handset maker Motorola Mobility for $12.5 billion, launching the Internet search and mobile software company into manufacturing for the first time.

HP "is saying 'I want to be more like IBM.' They divested their PC business and they got more involved in software," said FBN Securities analyst Shelby Seyrafi.

"The PC industry is a very challenged one because of the slow growth in that sector. For those companies like HP which don't have a strong tablet offering, they are victims of the encroachment of Apple's iPads and tablets on their notebook business. So they're vulnerable to losing share."

The acquisition of cloud search-software specialist Autonomy, which analysts say may draw rival bids, marks its boldest foray into the software and technology services after Apotheker came on board with a mandate to drive innovation.

A PC spinoff marks a historic shift for a company that Bill Hewlett and Dave Packard built into a sprawling $120 billion empire from a $538 garage operation in 1939.

"HP is recognizing what the world has recognized, which is hardware in terms of consumers is not a huge growth business anymore," said Michael Yoshikami, chief executive of YCMNET Advisors, a minor shareholder in HP. "It's not where the money is. It's in keeping with the new CEO's perspective that they want to be more in services and more business oriented." - Reuters