HP cuts thousands of jobs as AI reshapes operations
Rising memory chip prices driven by AI data centre demand may pressure HP’s margins from 2026, prompting a cautious profit outlook.
HP plans to cut between 4,000 and 6,000 jobs worldwide by fiscal 2028 as it restructures operations and expands its use of AI across product development and support services.
CEO Enrique Lores said the cuts will hit development, operations and support teams, with the plan aiming to save $1 billion over three years. The company already shed up to 2,000 roles in February under an earlier restructuring plan.
AI-enabled PCs now make up over 30% of HP’s shipments in Q4 ending 31 October, driving strong demand. However, analysts at Morgan Stanley warned that rising memory chip prices fuelled by AI data centre expansion could increase costs for consumer electronics makers.
Lores noted that HP expects the impact to be felt from the second half of fiscal 2026, though existing inventory should cover the first half.
HP projected fiscal 2026 adjusted earnings of $2.90–$3.20 per share, below expectations, with first-quarter profits also falling short of forecasts. Fourth-quarter revenue reached $14.64 billion, slightly ahead of forecasts.
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