While HP's future may be a little less confusing now that they've figured out what to do with webOS, the company is still having to deal with problems. Executives have been leaving since last year and it is now in the hands of CEO Meg Whitman to turn this ship around.
Unfortunately, this week we learned a little more trouble for the new CEO, in the single word no company employee ever wants to hear: restructuring. Hewlett-Packard will start reshaping its form starting next Wednesday when they will be reporting the quarterly earnings. In that same call, we are told that Whitman will be speaking on potentially cutting somewhere around 30,000 jobs from the workforce.
Those 30,000 jobs will be removed from the 320,000 employees that currently work at HP, however, the company should be moving forward with the plan over the course of at least a year or more. Whitman should be discussing the cuts as necessary in the earnings call. Whitman may also mention that the job losses during the time that the infamous Mark Hurd was running the show were made without considerations in future and growing projects for the company.
The restructuring effort, much like that of Sony and Cisco, will include severance packages and retirement options, however we do not have details of those terms as of yet. Sources are reporting that HP is looking to put 5,000 of the 30,000 employees they will be terminating into a retirement package of sort. Analysts have concluded that a workforce reduction of 18,000, 5%, would save HP $1.2 billion and would boost year-end earnings by 50 cents a share.
Sources say that manufacturing jobs won't be nearly as affected as other areas of the company. Their HP Services division, after another awful performance, will be seeing the majority of the cuts, mainly with employees who have had 8+ years experience and are highly paid. HP will not comment until their earnings call on any of these reports. I guess we'll wait until Wednesday to see what happens.
Can HP finally right the ship? Will these job cuts help or hurt the company? Tell us your thoughts in the comments section below.