Sep 10, 2012 11:37 AM EDT
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Hewlett-Packard Plans To Expand Total Job Cuts Under Reorganization Plan

By Donovan Jackson
HP
(Photo : Reuters) A woman walking past the Hewlett Packard logo at its French headquarters in Issy le Moulineaux

As the economy continues to appear more and grimmer day after day, job seekers have already began to quit looking for work entirely as the act continues to seem hopeless.

Hewlett-Packard Co. the world's largest personal-computer maker, expanded the total job cuts under its reorganization plan announced in May. Adding fuel to the fire of the failing economy.

The cuts, exceeding the 27,000 estimated earlier, will take place through fiscal year 2014, Hewlett-Packard said today in a regulatory filing. The company said it will book reorganization expenses of about $3.7 billion during the period.

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Hewlett-Packard is struggling with slower demand for printers, services and data-center equipment. The company said in May that it will fire workers and make early retirement offers to generate annual savings of as much as $3.5 billion starting in 2014.

Many cuts will take place in the ailing enterprise services group, which manages data centers and provides information-technology consulting.

"It's more than they said last time, but who's to say it's not going to get higher if things get worse?," said Brian White, an analyst at Topeka Capital Markets in New York, in a telephone interview. "They've got a lot of wood to chop, and this is a long-term turnaround story."

The company last month said it would write down the value of its enterprise-services business by about $8 billion. As part of restructuring, the unit will lose approximately 8,000 positions, including 7,300 eliminated as of July 31, Hewlett- Packard said in the filing today.

Former Chief Executive Officer Mark Hurd pushed into enterprise services with the $13.2 billion purchase of Electronic Data Systems Corp. in 2008.

 

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