HP to axe up to 16,000 staff after another disappointing quarter

By Graeme Burton
23 May 2014 View Comments
HP's Meg Whitman

The jobs of up to 16,000 staff are on the line at systems and services giant HP after its 11th consecutive quarterly sales decline.

The company, which employs about 250,000 people worldwide, indicated that another 11,000 to 16,000 more jobs would need to be lost after restructurings under CEO Meg Whitman that have already seen 34,000 jobs lost.

Further reading

Whitman, however, claimed that her strategy remained on track.

The company is feeling the pressure, in particular, in the PC hardware market, where margins are slim and competition tight. However, sales have remained largely flat across the board at HP. Indeed, sales in the personal systems group increased, year-on-year, but were squeezed in enterprise services. The printer business remained the company's most profitable unit overall.

Overall, sales declined by one per cent, although pre-tax profit increased by 2.8 per cent.

While more job losses are on the cards, Whitman pledged to increase investment in research and, in an interview, Whitman said that the cuts would fall in "areas not central to customer-facing and innovation agendas."

In common with other US technology companies, sales in China - which the US has accused of cyber espionage, while US security services have been found to be implanting eavesdropping devices onto IT hardware exports - also proved "challenging", according to Whitman.

Overall, sales dipped in the second quarter from $27.58bn to $27.31bn, but Whitman's cost cutting enabled the company to increase net income from $2.65bn to $2.72bn.

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