HP Inc. on Tuesday announced plans to cut 4,000 to 6,000 jobs worldwide by the end of fiscal year 2028. This move is part of a strategy to streamline operations, implement artificial intelligence to accelerate product development, improve customer satisfaction, and increase productivity. According to CEO Enrique Lores, in a briefing for the media, the layoffs will affect teams responsible for product development, internal operations, and customer support. “We expect this initiative to deliver $1 billion in savings to our gross operational rate over three years,” Lores added. Previously, in February, the company had already cut 1,000 to 2,000 employees as part of a previously announced restructuring program. Demand for AI-enabled PCs continues to grow, accounting for over 30% of HP’s shipments in the fourth quarter ending October 31. Analysts at Morgan Stanley warned that global price increases for memory chips, driven by rising demand from data centers, could lead to higher costs and put pressure on the profits of consumer electronics manufacturers such as HP, Dell, and Acer. At the Nvidia GPU Technology Conference (GTC) in San Jose, California, USA, scheduled for Thursday, March 20, 2025, Nvidia Corp., whose products are fueling the AI spending boom, stated that new types of AI models generating more complex responses will only intensify the need for computing infrastructure. Why has Nvidia, the global leader in AI chip manufacturing, been drawn into the trade war between the United States and China? The drive by major technology companies toward AI infrastructure development has caused price increases for dynamic random-access memory (DRAM) and NAND—two common types of memory chips—amid fierce competition in the server market. Lores reported that HP forecasts a tangible impact from higher prices in the second half of fiscal year 2026. At the same time, the company has sufficient memory inventory to cover needs for the first half of the year. “We are taking a cautious approach to our forecast for the second half of the year while taking decisive action, such as seeking lower-cost suppliers, reducing memory configurations, and taking pricing measures,” Lores explained. According to LSEG data, the company expects adjusted earnings per share (HPQ) for fiscal year 2026 to be between $2.90 and $3.20, which is below the analysts’ consensus estimate of $3.33. HP forecasts adjusted earnings per share in the first quarter to be in the range of 73 to 81 cents, with the midpoint of this range being below the estimates of 79 cents per share. Fourth-quarter revenue was $14.64 billion, exceeding analysts’ expectations of $14.48 billion.
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