HP Restructures, Focuses on AI

What happened

HP initiated a workforce reduction of 4,000 to 6,000 employees by fiscal year 2028, targeting approximately $1 billion in operational savings. This action coincides with an increased strategic focus on integrating artificial intelligence across its PC and printer business segments. The company reported that AI-enabled PCs constituted over 30% of its last quarter's shipments, contributing to $14.64 billion in revenues, despite anticipating shrinking profit margins in 2026 due to rising memory costs.

Why it matters

This workforce reduction introduces a significant operational capacity constraint, increasing the burden on remaining teams to sustain productivity and service delivery across all business functions. Concurrently, the projected rise in memory costs elevates due diligence requirements for procurement and financial planning, necessitating closer monitoring of supply chain resilience and expenditure. This impacts human resources, procurement, and financial operations, increasing exposure to potential service disruptions and cost overruns.