HP Eliminates 6,000 Positions While AI Computer Sales Surge

Computer maker HP has set in motion a workforce reduction initiative that will eliminate between 4,000 and 6,000 positions worldwide by October 2028. The cuts affect approximately one-tenth of HP’s 56,000-employee organization and form part of CEO Enrique Lores’s strategy to embed artificial intelligence throughout the company to boost innovation and productivity.
The layoffs will concentrate on product development teams, internal operations staff, and customer support personnel. The restructuring carries an upfront cost of $650 million but promises to generate $1 billion in annual savings once completed. This represents the second major workforce reduction this year, following the elimination of 1,000 to 2,000 positions in February.
Revenue performance demonstrates HP’s market success, with fourth-quarter sales reaching $14.6 billion and exceeding analyst projections. The company has captured significant market share in AI-enabled computers, which represented more than 30% of shipments during the quarter ending October 31. Consumer and enterprise appetite for AI-integrated computing solutions continues growing robustly.
Despite strong revenue results, HP’s profit outlook disappointed investors. The company projects adjusted net earnings between $2.90 and $3.20 per share for the coming year, below the consensus estimate of $3.33. Soaring memory chip prices driven by intense datacenter demand have pushed memory costs to 15-18% of PC production expenses. Trade tariffs further complicate the financial landscape.
Stock markets reacted negatively to the announcement, with HP shares falling 6%. The company’s transformation exemplifies widespread industry movement toward AI-driven operations as businesses leverage automation technologies to optimize processes and reduce expenses, fundamentally altering traditional employment models.