In a significant strategic shift, HP Inc. has unveiled plans to reduce its global workforce by up to 6,000 positions over the next three years. The move, part of a broader initiative to embed artificial intelligence across its operations, is projected to yield annual savings of approximately $1 billion by 2028.
The company, which currently employs around 56,000 people, stated that the restructuring will impact teams involved in product development, internal operations, and customer support. While the reductions are expected to incur upfront costs of about $650 million, leadership frames the decision as essential for accelerating innovation and enhancing productivity in an evolving technological landscape.
“We are at a pivotal moment where AI presents a substantial opportunity to transform our business,” said HP’s chief executive. “Integrating these technologies will allow us to innovate faster, improve the customer experience, and operate more efficiently.”
This announcement coincides with a sobering outlook on the labor market from economic researchers. Recent analyses suggest that automation and AI could displace millions of roles globally in the coming decade, particularly in administrative, legal support, and operational sectors. While new roles in AI supervision and development are expected to emerge, the transition period poses significant challenges for the workforce.
HP’s decision reflects a growing trend among corporations to leverage AI for operational efficiency. Other major firms, including prominent law practices and financial consultancies, have recently adjusted hiring plans or reduced staff, attributing these changes to the adoption of advanced technologies that automate routine tasks.
The push for AI integration is also influencing global supply chains. Surging demand from companies developing AI models has driven up costs for critical components like memory chips, which constitute a significant portion of personal computer manufacturing expenses. HP noted that these increased costs, alongside broader economic pressures, contributed to a profit forecast for the coming year that fell below market expectations.
Despite these headwinds, the company reported stronger-than-anticipated revenue for its latest quarter, fueled in part by growing demand for AI-enabled PCs. Nonetheless, news of the restructuring and the cautious financial outlook prompted a sharp decline in the company’s share price following the announcement.
The strategic pivot at HP underscores a broader industrial transformation, as businesses worldwide grapple with balancing technological advancement, cost pressures, and their human capital in the age of artificial intelligence.