In a significant restructuring move, HP Inc. has announced plans to eliminate between 4,000 and 6,000 jobs globally by the end of fiscal 2028, representing approximately 10% of its workforce. The decision comes as the PC and printer giant pivots toward artificial intelligence to streamline operations and boost efficiency across its business units. CEO Enrique Lores revealed that the job cuts will impact teams working on product development, customer support, internal operations, sales, and manufacturing.
The restructuring is part of HP's broader strategy to adopt AI-driven tools and automation across its operations. According to the company's latest earnings report, HP expects the initiative to generate approximately $1 billion in annual gross savings by fiscal 2028. The company anticipates restructuring charges of around $650 million, with about $250 million of those costs falling in fiscal 2026. This marks HP's second major workforce reduction in recent years, following a similar round of layoffs affecting 1,000 to 2,000 employees in February 2025.
HP's decision reflects a broader trend sweeping across the technology sector, where companies are simultaneously investing heavily in AI development while using the same technology to reduce operational costs and headcount. Major tech firms including Google, Microsoft, Amazon, and Intel have all announced significant workforce reductions over the past two years, citing the need to reallocate resources toward AI initiatives. Industry analysts note that AI automation is particularly affecting roles in customer support, content moderation, data entry, and certain programming tasks that can now be handled more efficiently by intelligent systems.
Despite the job cuts, HP reported strong financial performance in its fiscal fourth quarter, with revenue reaching $14.64 billion, beating analyst estimates. The company's personal systems segment, which includes desktops and laptops, saw an impressive 8% revenue increase to $10.35 billion, driven by demand for Windows 11 upgrades and early shipments of AI-enabled PCs. Notably, more than 30% of HP's PC shipments in the quarter were AI-enabled machines, signaling growing consumer and enterprise adoption of AI-powered computing devices. However, the printing business segment experienced a 4% decline to approximately $4.3 billion as customers delayed upgrades amid competitive pressure.
The company's outlook for fiscal 2026, however, fell short of Wall Street expectations. HP projects adjusted earnings per share between $2.90 and $3.20, below analysts' average estimate of $3.33. The company cited rising memory chip costs as a significant concern, with DRAM and NAND prices surging due to global supply constraints driven by heightened data center demand for AI infrastructure. CEO Lores told investors that HP plans to raise computer prices and work with new suppliers to help offset these higher costs, while continuing to invest aggressively in AI capabilities to maintain competitiveness in an increasingly AI-driven market.
The announcement has raised questions about the future of work in the technology sector and the broader implications of AI adoption on employment. While HP frames the restructuring as necessary to "streamline operations and invest more heavily in artificial intelligence capabilities," the move underscores a difficult reality: as AI tools become more sophisticated, they are increasingly capable of performing tasks traditionally handled by human workers. For employees and job seekers in the tech industry, particularly those in regions with strong offshore delivery models like India, these developments signal a fundamental shift in how technology companies structure their workforce and allocate human resources in an age of advancing automation.
