[Asia Economy New York=Special Correspondent Joselgina] Computer manufacturer HP has joined the wave of layoffs triggered by big tech companies by deciding to cut 4,000 to 6,000 employees over the next three years.
On the 22nd (local time), HP announced that it would carry out these layoffs as part of an innovation plan aimed at reducing costs by $1.4 billion annually. Accordingly, it will reduce a total of 4,000 to 6,000 employees by the 2025 fiscal year. Considering that HP had 51,000 employees as of October 2021, this corresponds to up to 12% of its workforce.
This decision by HP follows the cost-cutting and layoff plans announced by Meta Platforms, the parent company of Facebook, Twitter, Microsoft, and Salesforce, in preparation for an uncertain economy.
Enrique Lores, HP’s Chief Executive Officer (CEO), explained, "At this point, it is prudent not to assume that the market will turn around in 2023." In an interview with Yahoo Finance Live and others, he described the environment as "challenging" and said, "A significant portion of the cost savings will be reinvested in growth sectors such as gaming."
HP expects the sharp decline in demand for personal computers, which surged during the pandemic, to continue through next year. HP’s quarterly revenue was recorded at $14.8 billion, down 11.2% compared to the same period last year. In particular, laptop sales plummeted by 26%. The GAAP earnings per share for the 2022 fiscal year were $3.05, falling short of the previous forecast of $3.46 to $3.56. Additionally, HP announced a 5% increase in dividends on the same day.
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