HP and Foxconn announced that the two parties have established a joint venture for the development of servers designed for cloud computing services.

According to the two companies, they signed an agreement to set up a non-equity joint venture on May 1, 2014. Ownership splits and capitalization schedules for the new entity were not released.

The two companies said that the new mode of server which is optimized for cloud computing will help cloud computing service providers cut costs.

These new cloud computing servers will be manufactured, promoted, and sold by Foxconn; and HP will provide related support. The initial servers will bear the brand of HP and the first batch products are expected to go on sale later this year.