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September 16, 2015

HP to slash up to 30,000 jobs to cut costs

Meg Whitman says the move will make the two new units competitive.

By CBR Staff Writer

HP is planning to cut around 25,000 to 30,000 jobs from its enterprise business in order to cut costs.

The latest announcement is in addition to the 55,000 head count reduction by the company announced in 2012.

In October 2014, the company said that it is planning to split into two new publicly traded companies Hewlett-Packard Enterprise and HP Inc.

The company is reportedly planning to cut $2.7bn in annual costs which is expected to help the new companies better compete in a market which has moved past PC networks to cloud computing.

As of 31st October 2014, HP had more than 300,000 employees and the latest job cuts will bring down the company’s total workforce by at least 10%.

Another reason for the cuts could be the slump in sales, which fell from $127.2bn in fiscal 2011 to $111.5bn in its fiscal 2014.

However, the company expects that revenue from its cloud-related businesses to grow by more than 20% per year over the next several years.

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HP Enterprise CEO Meg Whitman said: "These restructuring activities will enable a more competitive, sustainable cost structure for the new Hewlett Packard Enterprise.

"We’ve done a significant amount of work over the past few years to take costs out and simplify processes and these final actions will eliminate the need for any future corporate restructuring."

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