HP to Cut Up to 6,000 Jobs Globally as AI Reshapes Operations

HP Inc on Tuesday announced a sweeping restructuring plan that will eliminate between 4,000 and 6,000 jobs worldwide by fiscal 2028, marking one of the company’s most significant workforce reductions in recent years. The move triggered an immediate market reaction, with HP shares falling 5.5% in extended trading.

The company said the job cuts will affect teams across product development, internal operations and customer support, as it pushes toward a more streamlined structure and deeper integration of artificial intelligence across its business. The shift is aimed at speeding up product cycles, improving customer experience and lifting long-term productivity.

HP expects the latest restructuring phase to generate $1 billion in gross run-rate savings over the next three years. Earlier this year, the company had already cut an additional 1,000 to 2,000 roles under a previously announced plan.

AI Demand Rising as Costs Increase

Demand for AI-enabled PCs continues to climb, now making up over 30% of HP’s shipments in the fourth quarter ended October 31. But even as AI drives new opportunities, rising memory chip prices are creating a fresh challenge for PC manufacturers.

A global surge in DRAM and NAND prices, fuelled by intense competition to build AI data centers, is expected to increase hardware costs for companies like HP, Dell and Acer. HP said it anticipates feeling the biggest impact in the second half of fiscal 2026, though it has enough inventory to absorb price pressures in the near term.

To manage the expected cost spike, the company is moving to qualify lower-cost suppliers, optimize memory configurations and adjust pricing where necessary.

Revenue Beats Estimates, Guidance Comes In Soft

HP reported fourth-quarter revenue of $14.64 billion, slightly above market expectations. However, the company’s profit outlook disappointed investors.

For fiscal 2026, HP forecasts adjusted earnings per share of $2.90 to $3.20, below analysts’ estimates. The company’s first-quarter guidance of 73 to 81 cents per share also landed near the lower end of expectations.

The latest update outlines a challenging path ahead for HP—balancing rising component costs, a major operational overhaul and accelerating demand for AI-driven devices—all while navigating uncertain global tech spending.