HP Slashes Workforce: 6,000 Jobs on Chopping Block as AI Takes Over

California-based computer and printer manufacturer HP has announced plans to eliminate between 4,000 and 6,000 positions globally by October 2028, representing approximately 11% of its 56,000-person workforce. The decision comes as the company pivots toward artificial intelligence integration across its operations, with CEO Enrique Lores emphasizing the transformative potential of AI in accelerating innovation and enhancing customer experiences.
The job reductions will primarily affect teams focused on product development, internal operations, and customer support functions. HP anticipates these cuts will generate annual savings of $1 billion by 2028, though the restructuring will initially cost the company an estimated $650 million. This marks the second round of layoffs this year, following the elimination of 1,000 to 2,000 positions in February as part of an earlier restructuring initiative.
Despite the workforce reductions, HP reported robust fourth-quarter revenues of $14.6 billion, surpassing market expectations. The company’s AI-enabled personal computers have gained significant traction, accounting for over 30% of shipments in the quarter ending October 31. This growth reflects increasing consumer and enterprise demand for AI-integrated computing solutions.
However, HP’s financial outlook for the upcoming year fell short of analyst predictions. The company forecasts adjusted net earnings between $2.90 and $3.20 per share, below the anticipated $3.33. This conservative projection stems from escalating memory chip costs driven by datacenter demand and additional expenses related to trade tariffs. Rising prices for dynamic random access memory and NAND semiconductors have increased memory costs to 15-18% of typical PC production expenses.
The announcement triggered a 6% decline in HP shares, reflecting investor concerns about profitability pressures. The move aligns with broader industry trends, as companies ranging from law firms to financial services providers increasingly leverage AI to automate routine tasks and reduce operational costs, fundamentally reshaping the employment landscape across multiple sectors.