- Layoffs to primarily impact teams involved in product development, internal operations, and customer service.
- HP plans aggressive cost-saving actions including qualifying lower-cost suppliers and adjusting memory configurations.
HP announced plans to slash 4,000 to 6,000 jobs worldwide by fiscal 2028 as part of a strategy to streamline operations and accelerate artificial intelligence adoption across product development and customer support. The announcement, made Tuesday, sent HP shares down 5.5 per cent in after-hours trading.
The Palo Alto-based technology giant said the layoffs would primarily impact teams involved in product development, internal operations, and customer service.
Strong demand for AI-enabled PCs
“We expect this initiative will create $1 billion in gross run rate savings over three years,” CEO Enrique Lores said during a media call. The planned reductions follow an additional 1,000 to 2,000 layoffs announced in February, part of a broader restructuring program.
HP is leaning into surging demand for AI-enabled PCs, which made up more than 30 per cent of its latest quarterly shipments. Still, the company faces mounting cost pressure from global memory chip price hikes, exacerbated by data centre demand for AI infrastructure.
To offset future chip cost pressures, HP plans aggressive cost-saving actions including qualifying lower-cost suppliers and adjusting memory configurations.
HP’s latest restructuring underscores the dual challenge many global tech manufacturers face: capturing opportunities in AI while navigating the realities of rising component costs and fierce competition.