HP revises restructuring figures; now cutting 29,000 jobs

Computer maker HP will cut 29,000 jobs -- an increase on its first estimate -- as the firm continues to cut back on costs as it falls down the PC building market share rankings.
Written by Zack Whittaker, Contributor

HP has said it will cut more of its global staff than first thought, upping the figure from around 27,000 to 29,000 employees.

The world's largest computer maker said in the 10-Q quarterly filing with the U.S. Securities and Exchange Commission (SEC) that it will, "eliminate approximately 29,000 positions in connection with the 2012 Plan through fiscal year 2014."

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HP's latest datacentre in Western Sydney, Australia. Credit: HP.

HP said in May that it would cut 27,000 jobs -- roughly 8 percent of its global workforce -- and plow the $3--3.5 billion it says it will save into research and development. The cuts will be spread over the next two years, but overall R&D spending will increase from the 3 percent of revenue it currently stands at. 

The filing notes that the multi-year restructuring plan -- dubbed the "2012 Plan" -- was aimed to "simplify business processes, accelerate innovation and deliver better results for customers, employees and stockholders." In a nutshell: cut the wheat from the chaff and clamber on to the market share rankings to keep ahead of its global competitors, notably up-and-coming Lenovo.

Also in the filing, HP said it expects charges of around $3.7 billion through the end of HP's fiscal 2014 calendar, with $3.3 billion relating to workforce reductions, and $400 million on "other items," such as datacenter consolidation.

The computing giant has already recorded a $1.7 billion charge during its 2012 third-quarter as a result of its restructuring plans.

HP said in the filing that the company has already shed 3,800 jobs -- around 7 percent of the revised 29,000 figure -- as of the end of July 2012. Employees from the ailing enterprise services group, which manages datacenters and consultancy to partners, are taking the brunt of the cuts. 

Last month, HP swapped its executives in the enterprise services unit, which accounts for more than a quarter of HP's total sales, and took an $8 billion charge in the process.

HP remains the world's largest computer maker by shipments, according to Gartner figures, recording 13.06 million shipments in the second-quarter -- despite a 12 percent decline year-on-year. Lenovo is poised to take the first-place slot in the coming weeks once September quarterly PC shipments figures are released.

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