HP Inc. has announced plans to cut up to 6,000 jobs worldwide by 2028 as part of a major restructuring aimed at accelerating its adoption of artificial intelligence (AI) across operations, product development, and customer support.
The layoffs will primarily impact teams in product development, internal operations, and customer service, according to CEO Enrique Lores. The tech giant expects these measures to generate around $1 billion in gross run-rate savings over three years.
The move follows an earlier round of layoffs in February, when HP reduced its workforce by 1,000 to 2,000 employees under the company’s ongoing restructuring plan. Rising component costs, particularly for memory chips used in AI infrastructure, have also pressured profit margins, prompting the company to adopt more aggressive cost-cutting strategies.
HP is preparing for higher costs in the second half of fiscal 2026 but has sufficient inventory to manage the first half, Lores said. Measures include qualifying lower-cost suppliers, reducing memory configurations, and adjusting product pricing to offset rising expenses.
Shares of the Palo Alto-based company fell 5.5% in after-hours trading following the announcement. Despite this, HP exceeded Q4 revenue expectations, reporting $14.64 billion, slightly above the forecasted $14.48 billion. For fiscal 2026, HP projects an adjusted profit per share of $2.90 to $3.20, below Wall Street’s average estimate of $3.33.
Analysts from Morgan Stanley warned that global memory chip price spikes, especially in DRAM and NAND, could continue to pressure profit margins for HP and other PC manufacturers like Dell and Acer.
With this sweeping AI-focused overhaul, HP aims to streamline operations, improve efficiency, and maintain competitiveness amid rising costs and growing demand for AI technologies.