HP is the latest big tech company to announce mass layoffs, with up to 6,000 jobs set to go over the next three years. The company is blaming the slowdown in the PC market for the cuts.
The news was announced as part of HP’s quarterly financial results late on Tuesday, which saw the company unveil a transformation strategy dubbed “Future Ready” which will help it reduce costs. As of last year the company, which specialises in PCs and printers, employed 51,000 people worldwide.
Why HP is making layoffs
HP’s results for the three months to the end of October show that the company’s revenue declined 0.8% year-on-year to $14.8bn. However, in its personal systems segment, which provides the bulk of company income, revenue was down 13%, to $10.3bn.
The income drop reflects falling demand for PCs following the boom during the Covid-19 pandemic, where companies and consumers were buying new equipment at unprecedented levels to facilitate remote working and home schooling. Now, with countries moving out of Covid-19 restrictions and businesses dealing with the impact of rising inflation and interest rates, this demand has fallen. Gartner said last month shipments had fallen 19.5% globally.
HP has concluded that cost savings need to be made, and it says changes under the Future Ready strategy will help it save $1.4bn a year, though it will also incur $1bn in restructuring costs. Between 4,000-6,000 roles will be cut, the company said.
“Looking forward, the new Future Ready strategy we introduced this quarter will enable us to better serve our customers and drive long-term value creation by reducing our costs and reinvesting in key growth initiatives to position our business for the future,” said Enrique Lores, HP president and CEO.
Tech job cuts continue across big-name businesses
The news means HP is the latest of tech’s big names to announce job cuts in recent months. Last week Amazon said it would lay off up to 10,000 staff, while Facebook parent company Meta had already started a process which will make 11,000 staff made redundant.
Like HP, chipmaker Intel blamed the PC market slowdown when it was revealed last month that it was making “thousands” of staff redundant.
Other businesses are feeling the pinch, too. Salesforce has let hundreds of staff go, while payments company Stripe and ride-hailing service Lyft said earlier this month they would be laying off 14% and 13% of their respective workforces.
The most high-profile job cuts have come at Twitter, where new owner Elon Musk decided to cull half of the company’s staff as he looks to cut costs following his $44bn takeover. Musk reportedly had a change of heart over some roles after workers were apparently fired in error.