- 4,000 to 6,000 jobs to be cut in HP’s latest cost-cutting move
- HP hopes AI will close the gaps – AI PCs have already proven themselves
- Revenue for the whole year grew only 3.2%, shares are still down compared to last year
HP has announced that it will cut 4,000-6,000 jobs as part of an ongoing cost-cutting initiative, largely driven by AI productivity gains.
Company CEO Enrique Lores confirmed the workforce reduction as part of the company’s latest Q4 earnings call, acknowledging the company’s ‘future-ready’ program it launched in 2022 as part of HP’s ‘financial 2026 plan’.
Despite already realizing more than $1.4 billion in savings from the scheme, Lores said further reductions would be necessary on the back of a 3.2% full-year increase in revenue and a slightly better 4.2% increase in quarterly revenue.
HP continues to cut staff
HP has already sent 2,000 workers packing by 2025 (per layoffs.fyi), with these latest plans to reduce global headcount even more set to play out between now and 2028.
“The company estimates that it will incur approximately $650 million in labor and non-labor costs related to restructuring and other costs, with approximately $250 million in fiscal 2026,” HP confirmed.
Product development, customer service and operational processes will be among the roles most likely to be affected, with AI stepping in to fill gaps left by departed workers.
HP also noted that the use of AI PC in the enterprise has increased team productivity by 16%, and confirmed that it would be “investing in AI-enabled initiatives to accelerate product innovation, improve customer satisfaction and increase productivity.”
More broadly, HP is also concerned about rising memory costs, which now account for 15-18% of a typical PC’s cost.
A decline in printing, especially among consumers, has also led to poor results. Net revenue within printing fell 4% compared to the previous year.
The company’s shares are largely unaffected by the announcement, but last month’s swings continue. Shares have fallen 20% over the past 12 months, but after bottoming out over the summer, the past six months have seen some resurgence.
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