HP says to cut 25000 to 30000 jobs in enterprise business

Tim Stonsifer, the incoming CFO of Hewlett-Packard Enterprise, the company devoted to corporate computing that will emerge from the split on November. Just four years ago, HP had 350,000 employees. The company reportedly invited some employees recently to quit without severance or take a job with a contractor for a much lower salary.

Hewlett-Packard’s (NYSE:HPQ) enterprise unit will cut 25,000 to 30,000 jobs from its work force as part of the restructuring as it separates from HP’s consumer operations, company officials said Tuesday.

“These restructuring activities will enable a more competitive, sustainable cost structure for the new Hewlett Packard Enterprise”, stated Meg Whitman, current HP chairman, president and CEO, who will become president and CEO of Hewlett Packard Enterprise.

It is now into the fourth year of its five-year recovery plan and the split is an integral part to help it adapt to the changing market.

The figure was a revision of its initial forecast of 45,000 as it struggled to catch up with its rivals.

In September of 2014, HP bought Goleta-based Eucalyptus, which focuses on developing open source cloud technology that interacts with commercial systems from Amazon and others. His goal is to have 60 percent of the workforce in countries with low labor costs by 2018.

HP under the leadership position of Whitman has a track record of making ongoing jobs cuts.

Through this massive layoffs, HP us hoping to save approximately $2.7 billion annually. HP Inc. will maintain the traditional PC and printer sales. Whitman likened the $4 billion (around £2.58 billion, or AU$5.58 billion) in losses to water draining from a bathtub.

The new enterprise company, set to trade under the stock symbol “HPE”, is expected to have more than $50 billion in annual revenue.

HP said the enterprise business will have more than $50bn in revenue and likely post earnings per share in the range of $1.85 and $1.95 in 2016.