HP Inc to slash up to 4,000 jobs in global restructure

HP Inc to slash up to 4,000 jobs in global restructure

Tech giant eyes up to $US300 million in savings from 2020

Dion Weisler - CEO, HP Inc

Dion Weisler - CEO, HP Inc

HP Inc plans to cut up to 4,000 jobs across its global footprint between the financial years 2017 and 2019, as part of a broader effort to restructure the business.

In filings lodged by the hardware giant in the United States, the company said that its board of directors had approved a restructuring plan that is expected to be implemented throughout the 2019 fiscal year.

It is hoped the restructure will generate gross annual run rate savings of around $US200 million to $US300 million from 2020. However, the company also said that the plan could cost more than its predicted savings from 2020 to implement.

“As part of the plan, HP expects approximately 3,000 to 4,000 employees to exit between fiscal 2017 and fiscal 2019,” the company stated. “The changes to the workforce will vary by country, based on local legal requirements and consultations with employee works councils and other employee representatives, as appropriate.

“In connection with the plan, HP anticipates incurring approximately $US350 million to $US500 million in restructuring and other charges due to both labor and non-labor actions. Of these amounts, HP expects to incur approximately $200 million in labor costs related to workforce reductions,” HP Inc said.

It is unclear at this stage which parts of the company’s operations will be hit hardest by the proposed job cuts or how the company’s local workforce will be affected by the move.

The decision to shed an additional 3,000 to 4,000 employees from its ranks follows HP Inc’s announcement in February this year that it would let around 3,000 workers go within the following 12 months.

That announcement represented an acceleration of earlier plans to trim around 1,200 staff from its ranks in 2016, as part of an overall restructuring goal of dispatching up to 3,300 workers over the following three years.

“We are accelerating the restructuring program also announced at SAM by increasing the fiscal 2016 employee reductions to approximately 3,000,” HP Inc CEO, Dion Weisler, said at the time.

“I believe there may be even more opportunity to reduce cost and streamline processes, and we will share details when finalised,” he said.

The hardware giant's move to reduce its global workforce comes as the latest figures by industry research firms, IDC and Gartner, reveal a continuing downward trend in worldwide PC shipments.

According to IDC's research, worldwide PC shipments reached 68 million during the third quarter of 2016, a decline of 3.9 per cent compared to the same period last year.

Meanwhile, according to Gartner, PC shipments totalled 68.9 million units in the third quarter, a 5.7 per cent decline from the third quarter last year.

HP Inc had not responded to ARN's queries at the time of writing.

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