HP announced Tuesday that it will cut between 4,000 and 6,000 jobs worldwide by fiscal 2028 as the company shifts more of its focus toward artificial intelligence.
The move is part of a major plan to simplify operations, speed up product development, and improve customer service.
CEO Enrique Lores said the cuts could affect teams working in product development, internal operations, and customer support, making up as much as 10% of the company's workforce.
Speaking during a media briefing, Lores explained that the new strategy is designed to make HP faster and more efficient.
"We expect this initiative will create $1 billion in gross run rate savings over three years," he said. Shares of HP fell more than 5% in after-hours trading following the announcement, NY Post reported.
The company has already been restructuring this year. In February, HP laid off an additional 1,000 to 2,000 employees as part of a separate cost-cutting plan. Now, the push toward AI is driving even more change inside the longtime tech giant.
HP to slash up to 6,000 jobs in big restructuring — latest tech company to pivot to AI https://t.co/FWio9XgyIm pic.twitter.com/FKEviAyq5j
— New York Post (@nypost) November 25, 2025
HP Braces for Higher Memory Prices in 2026
According to CNN, HP says demand for AI-enabled PCs is rising quickly, making up more than 30% of its shipments in the fourth quarter ending October 31.
But the company also faces challenges. Global prices for memory chips—key parts used in computers—have surged due to heavy demand from data centers building AI systems.
Analysts warn these rising prices could hurt profits for companies like HP, Dell, and Acer.
Lores said HP expects to feel higher memory costs in the second half of fiscal 2026 but has enough inventory to get through the first half.
To prepare, the company is "qualifying lower-cost suppliers," reducing certain memory options, and adjusting prices to help protect its bottom line.
Despite the new savings plan, HP warned that its future profit expectations will fall below what many analysts predicted.
The company expects fiscal 2026 adjusted earnings per share to land between $2.90 and $3.20, lower than the average estimate of $3.33. Its forecast for the first quarter also came in slightly under expectations.
Even with the uncertainty, HP posted solid numbers for the fourth quarter. Revenue reached $14.64 billion, topping estimates of $14.48 billion.
Originally published on vcpost.com
