Technology

HP to cut 9,000 jobs in bid to reduce costs

Restructuring charges estimated to come in at $1bn

HP said it is to cut its global headcount by between 7,000 and 9,000 roles via redundancies and voluntary early retirements.

Fri Oct 4 2019 - 12:49

HP plans to cut as many as 9,000 jobs as part of broader plans at the computer and printer maker to reduce costs and simplify its business.

In a statement late on Thursday, the Palo Alto-based company said that it is to cut its global headcount by between 7,000 and 9,000 roles via redundancies and voluntary early retirements. That works out as a 16 per cent cut to its workforce based on a total headcount of 55,000 as of the end of 2018.

HP expects to book about $1 billion (€910 million) in restructuring charges between now and fiscal year 2022 as a result, but anticipates that the job losses will also generate about $1 billion in savings by the end of 2022.

The move comes as HP gears up for its first leadership change in four years. “We are taking bold and decisive actions as we embark on our next chapter,” said Enrique Lores, the company’s incoming chief executive officer. Mr Lores is due to replace Dion Weisler, who is stepping down due to “a family health matter”, on November 1st.

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“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.”

The company said that it anticipates that non-GAAP diluted net earnings per share to come in at between $2.22 and $2.32 per share in fiscal year 2020. That compares with the average estimate of $2.23 by analysts polled by Bloomberg.

HP separately said on Thursday that its board had approved an additional $5 billion in share buybacks.

The shares are down about 10 per cent year-to-date compared with a 16 per cent gain for the S&P 500. – Copyright The Financial Times Limited 2019

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