Hewlett-Packard Co (HPQ) said it expects to cut 25,000 to 30,000 jobs as part of its restructuring and cost-saving efforts at it enterprise services business.
HP is splitting into two listed companies later this year, separating its computer and printer businesses from its faster-growing corporate hardware and services operations, to be called Hewlett Packard Enterprise.
The expected job cuts will result in a charge of about $2.7 billion, beginning in the fourth quarter, HP said in a statement on Tuesday.
“We’ve done a significant amount of work over the past few years to take costs out and simplify processes and these final actions will eliminate the need for any future corporate restructuring,” Chief Executive Meg Whitman said.
Hewlett-Packard had about 302,000 employees globally as of Oct. 31, 2014, according to the company’s fiscal 2014 report.
The enterprise business is expected to report free cash flow of $2.0 billion to $2.2 billion in 2016, at least half of which is expected to be returned through dividends and share buybacks.
Hewlett Packard Enterprise is expected to report adjusted profit of $1.85 to $1.95 per share in 2016.
The stock fell 2.3 percent to $26.50 in extended trading on Tuesday.
I don’t have much to say about this other than to note a couple of things. Typically, when a company splits into two separate entities, one entity is going to die. It’s too bad their printer business will be chained to their PC business. I liked their business printers. I found them easy to network and use.