HP’s Layoffs More Dramatic Than Thought

The axe has been falling at HP faster than anticipated.

HP Trade Show LogoIn May 2012, the company said it would cut 27,000 positions globally, 9,000 of them in the U.S. By that September, it revised that number upward to 29,000. Originally, HP said the layoffs would occur over two years as part of a “multi-year productivity initiative” aimed at simplifying the way it operates and allowing the company to be more innovative.

However, in an SEC filing Monday, HP said it has already shed 22,700 employees and that the number of jobs cut could vary by 15 percent as it seeks $3 billion in savings on labor costs.

HP originally said that although it expected a significant number of employees to accept buyout offers, a large number of layoffs was expected. Soon after, CEO Meg Whitman created a stir by saying the jobs of workers in India would be spared.

HP is trying to shift from low-margin commodity technology to higher-margin offerings such as its Moonshot servers. There’ve even been hints that it will re-enter the smartphone market despite its abysmal experience with webOS.

In August, HP released mixed quarterly results at the low end of its guidance, with improvements in cash and debt. Whitman has said that two years into its five-year turnaround plan, the company is on track. However, she’s acknowledged that year-over-year revenue growth is unlikely even in fiscal 2014.

In another sign of its flagging reputation on Wall Street, the company has been dropped from the Dow Jones Industrial Average. Along with Bank of America and Alcoa, it’s being replaced based on its sagging stock price and the index committee’s desire to juggle the mix of companies. Goldman Sachs, Visa and Nike will take their place on the 30-company Blue Chip index.

Comments

  1. BY Fred says:

    HP should needs to change it’s slogan from “Invent Here” to “Outsourced there” .

  2. BY schmitz says:

    HP its not that hard. Printers- Lower the price on your laserjets you can’t beat Brother, samsung, canon and oki etc.
    Moonshot – yes.
    Proliants – yes. push an openstack distro to run on the hardware.
    Laptops- Lower your price on business laptops. You can’t beat Dell on pricing.
    Phones = make it Android and improve on the mail app for Exchange you’ll have a winner.

  3. BY Outsourced Sam says:

    With all these layoffs happening it’s such a good thing the (D) Senate has 100,000 cheap ‘highly skilled’ laborers to fill in the gaps.

    Must be a ‘skill’ issue.

  4. BY Micky D says:

    Here’s an idea HP – how about stop building planned obsolences into your products??

    Like PC motherboards that fail (almost automatically) at three years, to printer cartridges with expiration date chips that keep them from operating after expiration.

    Your company got into this habit and created a LOT of ill-will with very loyal customers (I was one of them).

    I buy only Lenovo and Toshiba now and won’t ever look back. Goodbye HP.

  5. BY Micky D says:

    Would rather buy an older used HP printer than a new one. The newer they are, the more expensive the printer cartridges are and the more often you have to replace them (ink or toner). Tired if getting raped. I looked at a brand new color laser jet – cartridges are $125 each. Because unit requires 4, thats $500 for a full cartidge set. Forget about it. My older HP color cartridges are $65 to $80 each, still high, but more manageable.

    HP plays too many games with toner\ink.

  6. BY Dave-0 says:

    Thank you Mr Obama. I’ll just take on 4 part-time jobs to replace the one full-time job I just lost.

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