HP announces a major restructuring, cutting 10% of its workforce to focus on AI adoption, aiming for $1 billion in annual savings by 2028.
SAN FRANCISCO: Computer and printer maker HP has announced a sweeping restructuring plan that will eliminate about 10% of its global workforce.
The tech giant expects to reduce its headcount by between 4,000 and 6,000 employees as it pivots toward artificial intelligence to boost efficiency.
According to its latest earnings report, the move aims to increase innovation and customer satisfaction through AI adoption.
HP’s decision reflects a broader trend across the tech sector of investing heavily in AI while using the technology to reduce operational costs.
Major firms including Google, Microsoft, and Amazon have also announced workforce reductions over the past two years.
Many companies cite the need to reallocate resources, including jobs, toward AI initiatives.
Industry analysts say AI automation is particularly affecting roles in customer support, content moderation, data entry, and certain programming tasks.
HP said its AI plan aims to generate approximately $1 billion in annual savings by the end of fiscal 2028.
The company has been working to transform its business model amid changing demand patterns in the PC and printing markets.
HP CEO Enrique Lores told the Wall Street Journal that the company plans to raise computer prices and work with new suppliers.
This strategy is intended to help offset the higher costs associated with AI computing.
In its latest quarter, HP posted a profit of $795 million, compared with $906 million a year earlier.
Revenue rose 4.2% to $14.64 billion, topping analyst estimates.
Strong sales in PCs managed to offset a decline in printer sales during the period. – AFP
