Saturday, October 22, 2016

HP Inc. to shed 3 to 4 thousand jobs during the next 3 years

HP Inc. the successor company to Hewlett-Packard the computer manufacturer is downsizing once again. The company announced that it expects to eliminate 3,000 to 4,000 jobs over the next three years.

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Between 2007 and the second quarter of 2013, Hewlett-Packard was the world's leading PC manufacturer but was then overtaken by Lenovo. On November 1, 2015 the company split into two with HP Inc. being the computer and printer business and Hewlett Packard Enterprise providing services and enterprise products.
HP has been shedding jobs for years now:On December 31, 2013, HP revised the amount of jobs cut from 29,000 to 34,000 up to October 2014. The current amount of jobs cut until the end of 2013 was 24,600.[70][71][72] At the end of 2013 the company had 317,500 employees. On May 22, 2014 HP announced it would cut a further 11,000 to 16,000 jobs, in addition to the 34,000 announced in 2013. "We are gradually shaping HP into a more nimble, lower-cost, more customer and partner-centric company that can successfully compete across a rapidly changing IT landscape," CEO Meg Whitman said at the time.The restructuring plan could eliminate as many as 50,000 jobs in total. Earlier Meg Whitman CEO of HP said that the restructuring was finished but later she made no such promise but said that the turnaround of HP was still on track and that it made sense to increase layoffs during a turnaround of the scale HP was engaged in.
Now, HP again expects to lay off about 3,000 to 4,000 jobs in the next three years. The announcement sent shares down 1.3 percent. Profits of HP for fiscal 2017 are expected to be $1.55 to $1.65 per share, in line with the expectations of analysts at $1.61 per share on average. The company increased its quarterly dividend by 7 percent and said it would increase its share buyback program by $3 billion.
Although restructuring and other charges will cost $350 to $500 million the job cuts are expected to save $200 to $300 annually by 2020. While the savings will provide no consolation for those who lost their jobs, it may help HP survive in a PC market that looks bleak. PC sales continue to decline with quarter 3 shipments 5.7 percent less than the previous year. According to research firm Gartner this is the 8th consecutive quarterly decline in sales the longest on record.


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