SAN FRANCISCO — Hewlett-Packard Co. said Tuesday that it would cut 14,500 jobs, or 10% of its workforce, as the storied computer and printer maker slashes costs to remain competitive in an industry that it helped create.
The restructuring, which will be implemented over the next 18 months, is expected to reduce annual expenses at the iconic Silicon Valley company by $1.9 billion. HP employs 58,000 people in the United States — about 9,000 of them in the Bay Area. The company said it was too early to discuss where the deepest cuts might occur.
Tuesday's changes are the most significant so far by Chief Executive Mark Hurd, who took over in March after predecessor Carly Fiorina was ousted for failing to remake HP in the face of pressure from low-cost manufacturers such as Dell Inc.
Word of the job cuts spread through the company last week, and employees at HP's Palo Alto headquarters grimly referred to Hurd's plans as "The Big One." The staff reductions would be the second-largest in the company's 66-year history. HP cut 15,900 jobs in the wake of its 2002 acquisition of Compaq Computer Corp.
Some noted sadly that the cuts — which will occur mainly through layoffs — marked a shift in corporate culture at HP, which for years operated as the sort of close-knit company where founders William Hewlett and David Packard routinely walked around chatting with workers.
But others said Hurd was returning HP to its engineering roots because most of the cuts targeted the company's sales and support staffs, including finance and human resources. Notably, Hurd made only minor trims to HP's research and development budget, which some analysts had criticized as too lavish in an era of ever-dwindling margins and relentless competition.
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It is sad that HP was the largest personal computer manufacturer and now they are laying off more people. Seems like they have had problems since 1992. They have gone in the last year from making 47% of all personal computers to 35%. Not a big loss but I guess enough to make all these layoff.
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