HP has unveiled plans to eliminate up to 6,000 jobs globally through October 2028 as part of a comprehensive strategy to integrate artificial intelligence throughout its business operations. The move represents the latest example of major corporations restructuring their workforces in response to advancing automation technologies.
Chief Executive Enrique Lores outlined the company’s vision for leveraging AI to accelerate product innovation, enhance customer satisfaction, and boost overall productivity. The technology will be deployed across multiple business areas, including product development teams, internal operations, and customer support functions. Once complete, the restructuring is expected to generate approximately $1 billion in annual savings, offsetting the estimated $650 million implementation cost.
The announcement reflects multiple challenges facing the computer and printer manufacturer. HP provided a lower-than-expected profit outlook for the upcoming year, forecasting adjusted earnings per share between $2.90 and $3.20, compared to analyst expectations of $3.33. Contributing factors include rising costs from trade tariffs and dramatically increasing memory chip prices.
Memory components, which currently account for 15% to 18% of typical PC manufacturing costs, have experienced accelerated price growth in recent weeks. The surge is driven by intense demand from companies building datacenter infrastructure to support AI model development and deployment. Cloud service providers are purchasing large quantities of dynamic random access memory and NAND semiconductors to meet computing requirements for advanced AI systems.
Despite these economic pressures, HP reported better-than-expected fourth-quarter revenues of $14.6 billion. The company is benefiting from continued strong demand for AI-enabled personal computers, which comprised more than 30% of its shipments in the quarter ending October 31. However, investors reacted negatively to the job cut announcement, pushing HP shares down as much as 6% following the news.