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UPDATED: HP slashes 27,000 jobs as part of restructuring program

UPDATED: HP slashes 27,000 jobs as part of restructuring program

The cuts will amount to 8 per cent of HP's workforce as part of restructuring program that started last year and is to continue through to 2014.

It's official. Hewlett-Packard will cut 27,000 employees as part of its long-term restructuring plan, the company said when it announced quarterly financial results.

The company will shed about 8 per cent of its workforce through a combination of layoffs and retirement offers that started last October 31 and will continue through the end of its 2014 fiscal year, HP said.

The lay-offs are the biggest in its 73-year history.

Employee reduction plans vary by country.

The restructuring program is expected to save $US3 billion to $US3.5 billion through fiscal year 2014, and a majority of those savings will be reinvested in the company, HP said in a statement

The job cuts are "difficult" but they also are "necessary to improve execution and to fund long-term health" of HP, CEO Meg Whitman said in a statement.

HP also announced that its net income for the second quarter, which ended April 30, was $US1.6 billion, a drop of 31 per cent over the same quarter a year ago.

It reported revenue of $30.7 billion, down 3 per cent.

Excluding one-time charges, the company's earnings per share was $US0.98, which topped the consensus estimate of $0.91 from analysts polled by Thomson Reuters.

The company also forecast third quarter earnings of $US0.94 to $US0.97, below previous expectations of $US1.02 per share, but it expects that its full-year earnings will be $US4.05 to $US4.10, rather than $US4.03 that analysts had forecast.

The announcement confirms industry rumours over the past week that HP was about to cut up to 30,000 staff.

A HP South-Pacific enterprise spokesperson said, "We have not yet announced specific plans with regards to specific locations. We do expect the workforce reduction to impact just about every business and region. Beyond this, we don’t have any additional information to share at the moment.

Agam Shah covers PCs, tablets, servers, chips and semiconductors for IDG News Service. Follow Agam on Twitter at @agamsh. Agam's e-mail address is agam_shah@idg.com

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