Computer maker HP has committed to eliminating between 4,000 and 6,000 positions worldwide by October 2028 as part of its digital transformation strategy. The workforce reduction affects approximately 11% of the California company’s 56,000 employees, with leadership emphasizing artificial intelligence’s transformative potential for product innovation and operational efficiency.
The layoffs will concentrate on product development teams, internal operations staff, and customer support personnel. While requiring an initial investment of $650 million in restructuring costs, HP projects the initiative will deliver $1 billion in annual savings once fully implemented. This represents the second major workforce reduction this year, following the elimination of 1,000 to 2,000 positions in February.
Revenue performance demonstrates HP’s market strength, with fourth-quarter sales totaling $14.6 billion and surpassing analyst projections. The company has successfully captured growing demand for AI-enabled computers, which represented more than 30% of shipments during the quarter ending October 31. Consumer and enterprise appetite for AI-integrated computing solutions continues expanding.
Despite revenue achievements, HP’s profit outlook concerned investors. The company forecasts adjusted net earnings between $2.90 and $3.20 per share for the coming year, below the consensus estimate of $3.33. Soaring memory chip prices driven by intense datacenter demand have pushed memory costs to 15-18% of PC production expenses. Trade tariffs further constrain profitability margins.
Stock markets reacted negatively to the announcement, with HP shares falling 6%. The company’s transformation exemplifies widespread industry movement toward AI-driven operations as businesses deploy automation technologies to streamline processes and reduce expenses, fundamentally reshaping employment patterns across the technology sector.
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