HP to Layoff 27,000; Largest Layoffs in Company History
May 23, 2012 4:47 PM
comment(s) - last by
(Source: Jason Mick/DailyTech LLC)
Chinese unit is expected to be spared; remaining workers are pressured to "work harder"
Soon, approximately 27,000 workers at Hewlett-Packard Comp. (HPQ) will be
out of the job
-- almost 8 percent of the company's total staff of 324,000.
HP surprised with
better than expected earnings
for fiscal Q2 2012, announcing revenue of $30.7B USD, more than the analyst consensus of $29.9B USD. Profit checked in at $2.3B USD ($1.05 USD/share), more than the $1.02 USD/share analysts predicted. Optimism in the stronger-than-expected performance was tempered by estimates for the next quarter, which were
lower than analysts expected
, amid a slump on sales of printers, data-center equipment, and services.
The HP layoff program will be gradually implemented as part of a restructuring that wraps up by October 2014. The layoffs will be the largest in the company's 73-year history. News of the painful layoffs
leaked last week
HP has not revealed a precise timeline for when the job cuts will occur, within the 2012-2014 restructuring windows. However, sources indicate that most of the cuts will likely come in the U.S. and Europe, while the company's Chinese unit -- a major growth target -- will largely be spared.
Meg Whitman is thinning the herd at HP, hoping to get the same amount of work out of less engineers. [Image Source: towleroad]
Remaining employees will have to pick up the slack for their departed co-workers under former eBay, Inc. (
) CEO and new HP CEO
Meg Whitman's vision for the company
. Still a bit of a silver-lining to this cloudy news is that Ms. Whitman did indicate that some of the $3.5B USD saved would be reinvested in working towards restoring
to its former glory.
Long a bastion of electronics industry research, HP Labs has continued to do novel work, such as
inventing the memristor
-- a long theorized circuit element, which could lead to new cheaper,
more power-efficient kinds of storage
. However, the cutbacks have forced the star institution to operate on a shoestring budget, raising questions of whether HP will be able to continue to attract top talent. The situation is so bad at HP Labs, according to
The New York Times
, that researchers are forced to use pirated software for their day-to-day work.
HP's deep cuts are bad news for its employees -- and U.S. engineers in general who will face greater competition in the jobs market. However, they're hardly out of place in a post-recession U.S., where many companies have learned that they can boost profits by squeezing the same amount of work out of fewer employees. That philosphy has helped to stifle job recovery, even as GDP growth has slowly come back to life post-recession.
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RE: Buy American?
5/24/2012 1:31:01 PM
Yes it so high.The west is in a big rush to the magic zero % mark for corps and give them corporate welfare.For you guys in the 50/60's wasn't it near 90%?They just never paid that but it forced the companies to spend there most of their profits on the company.Therefor paid way less in taxes.
Now with lower and lower corp base tax it does the opposite.They pocket more and more and give it to the top and the shareholders.That why you see ceo and his buddies get 10's of millions even if he did the worst job in the world like hp last ceo as a example.
Just look a a mid size biz and why do u see the owner buy a new company truck every so many years to drive around in?.Buy the truck lower his end of year profit get a nice truck and pay less in tax vs not buying it and giving the money to the government.
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