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HP has announced it plans to cut 10% of its workforce as the company adjusts to declining demand for business computers and mobile workstations as enterprises everywhere continue to recover from the Covid-19 pandemic.
The computing giant has revealed (opens in new tab) its results for fiscal year 2022, with fourth-quarter revenue down 14.8% compared to the same period last year.
The cuts, which will affect anywhere from 4,000 to 6,000 employees, could expose the struggle not just for HP, but for PC makers in general, as companies may buy less equipment to hybrid works practices, and cutting the cost of the tech stack in the midst of an ongoing recession.
HP’s cost-cutting measures
As noted by the Wall Street Journal (opens in new tab)the mass layoffs come after HP increased its workforce by about 10,000 employees compared to this time last year.
However, the company has realized that there are ways to save money other than throwing away the lives of ordinary employees who are also trying to stay afloat in a cost-of-living crisis.
In what it calls its “Future Ready Transformation for Fiscal Year 2023” and someone else might call “a slew of cost-cutting measures,” HP claimed it would realize savings in “digital transformation, portfolio optimization, and operational efficiency”.
A specific example was taking advantage of plummeting hardware demand by relying on cheaper, slower ocean freight deliveries instead of faster air freight.
HP’s announcement of new cost-cutting strategies comes after the publication of data (opens in new tab)showing that demand for PCs across the hardware manufacturing industry is declining at the fastest pace in two decades, with no sign of stopping.
Evidence for this lies in the recent reports from the WSJ that Intel (opens in new tab) and Advanced micro devices (opens in new tab) (AMD) are also turning to cost-cutting measures to ease economic pressures.