:max_bytes(150000):strip_icc()/GettyImages-2244656778-d51c02bf574f49fab60aaf6fd6ef67b6.jpg "HP Joins Big Tech Companies Laying Off Workers Amid AI Push")
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Key Takeaways
- HP announced a restructuring plan that will involve 4,000 to 6,000 layoffs, as it aims for savings of about $1 billion by fiscal 2028.
- The computer maker’s latest quarterly results topped estimates, but its profit outlook was lower than expected.
Computer and printer maker HP’s (HPQ) stock slid Wednesday, a day after the company announced a major cost-cutting plan that includes layoffs.
The company said it aims to eliminate between 4,000 and 6,000 roles as part of its efforts to save $1 billion over the next three fiscal years. For HP, which said it had about 58,000 employees in its latest annual filing, the cuts could represent up to 10% of its workforce.
Meanwhile, CEO Enrique Lores told investors during Tuesday’s earnings call that the company plans to continue investing in AI-related initiatives as it sees “a significant opportunity to embed AI into HP to accelerate product innovation, improve customer satisfaction, and boost productivity,” according to a transcript provided by AlphaSense.
The move makes HP the latest tech company to announce layoffs despite business looking solid in its latest quarter, highlighting what could be growing trend. A number of tech giants, including Amazon (AMZN) and Microsoft (MSFT), have also undertaken layoffs in recent months, while ramping up their AI efforts.
Why This Is Significant
The flurry of recent layoffs could point to growing pressure on tech companies to make cuts where they can to help support their spending on AI, while some may be expecting the technology could reduce the need for some roles over time.
HP reported better revenue than expected at $14.6 billion for the fiscal fourth quarter. Its adjusted earnings per share of $0.93 was also slightly above analysts’ expectations compiled by Visible Alpha.
The company’s profit outlook of $2.90 to $3.20 in EPS for fiscal 2026, however, came in below the analyst consensus.
HP shares were down about 2% in recent trading, bring their year-to-date losses close to 27%.
