Hewlett Packard (HP) has warned that its planned layoffs will be even more wide-reaching than previously announced, with nearly 58,000 due to leave the company.
HP has been struggling financially for some time, and announced a plan to cut costs in 2012 through a headcount reduction programme - read 'people being made redundant' - which would see its global staff reduced by around 25,000. In the years since, that figure has grown to a whopping 55,000 - and now chief financial officer Cathie Lesjak has warned that the final figures will be even higher.
'We are nearing the end of our 2012 restructuring programme,
' Lesjak told press and investors during the company's most recent quarterly earnings call, 'and 3,900 people exited in Q3. By the end of Q4, we expect to exceed our prior estimate of 55,000 people to exit the company by up to five per cent, but will not exceed the forecasted GAAP-only [Generally Accepted Accounting Principles only] charges
' totalling around $5.5 billion.
The admission of the deeper than expected cuts comes as the company announces an 11 per cent year-on-year decline in revenue for the quarter and ahead of plans to split the company into two parts, one with an enterprise focus and one with a consumer focus, as announced back in October last year
- a plan that will likely bring further job losses.
HP's share price dropped 1.37 per cent on the news and plunged in after-hours trading before stabilising 2.05 per cent below its close-of-business price. The company is now valued at just over half its 2011 market cap, with recent losses threatening to wipe out gains it had made from 2013 onwards.