HP Inc. will cut 7,000 to 9,000 employees as part of a restructuring that will stretch from late fiscal 2019 through fiscal 2022, the PC and printer giant confirmed today. HP currently has about about 55,000 employees, SeekingAlpha estimates.
HP's 2019 fiscal year 2019 ends of October 31, and the 2020 fiscal year kicks off on November 1. The layoff announcement arrives amid a CEO transition from Dion Weisler to Enrique Lores.
The announcement contained timely market jargon, describing how HP will become more "digitally enabled" while "disrupting industries."
HP: Too Dependent On Hardware
HP continues to innovate in the PC and printer markets. And the company's hardware business remains channel-friendly, with a growing commitment to device-as-a-service partner models. Nevertheless, the hardware-driven business missed out on most of the big digital transformation trends of the past decade -- particularly cloud, mobile, managed and subscription services.
The restructuring will cost the company about $1.0 billion -- including $100 million in fiscal Q4 of 2019, $500 million in fiscal 2020 and the rest split between fiscal 2021 and 2022. The changes will save HP $1 billion annually over the long haul, the company said.
In a prepared statement, Lores said:
“We are taking bold and decisive actions as we embark on our next chapter. We see significant opportunities to create shareholder value and we will accomplish this by advancing our leadership, disrupting industries and aggressively transforming the way we work. We will become an even more customer-focused and digitally enabled company, that will lead with innovation and execute with purpose."
Added exiting CEO Weisler:
"I’m proud of the progress we have made across our business with cutting edge innovation, disciplined execution and a purpose driven culture. I have no doubt our team will keep raising the bar under Enrique’s leadership.”
HP Inc and HP Enterprise Layoffs: Multi-year Staff Cuts
The former Hewlett-Packard Co. split into HP Inc. (PCs and printers) and HP Enterprise (data center solutions) in November 2015. Both companies have attempted to diversity beyond traditional hardware, but both firms have also had multiple rounds of layoffs in recent years.
Previously announced job cuts include:
- June 2018: HP increased its layoff plans to potentially cut up to 5,000 positions, up from the previous 3,000 to 4,000 cuts announced in October 2016.
- September 2017: Hewlett Packard Enterprise (HPE) apparently planned to cut 5,000 positions.
- October 2016: HP confirmed plans to cut 3,000 to 4,000 positions from fiscal 2017 to 2019.
