This may be a bad year for people working in the technology sector. Back-to-back layoff announcements by big companies have created concern. Many firms that cut staff last year fearing an economic slowdown are axing jobs this year to make way for artificial intelligence. HP, one of the world's largest PC and printer makers, has joined the bandwagon. The company intends to cut 6,000 jobs over the next two to three years.
HP said the restructurings are part of plans to make the business leaner and deploy more AI within product development. The projected reduction of employees is between 4,000 to 6,000 globally by fiscal year 2028. This will cut about 10% of its workforce. As of October 2024, HP will be retaining around 58,000 worldwide.
HP's CEO, Enrique Lores, announced that such cuts would hit product development, internal operations, and customer support departments. He explained, “These measures are necessary for the company to stay competitive. We estimate that this decision will save about one billion dollars.” Earlier this year, HP also announced the layoff of 1,000 to 2,000 employees as part of its restructuring plan.
HP faces increasing manufacturing costs, partly due to the tariffs imposed during the Trump era. Additionally, customers replace older computers with newer ones to access AI features, which also raises demand for memory chips. According to sources, these are some of the reasons the company engages in such cost-cutting measures. Following the announcement, shares of HP sank about 5.5% in the US stock market.
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