HP Inc. plans to cut 3,000 to 4,000 jobs over the next three years as reported to ET. This was done to bring cost in control with the falling demand in the market for personal computers and printers.
HP, the hardware business of former Hewlett-Packard said the restructuring program was decided as they were struggling with a subdued market, sending its shares down 1.3 percent in extended training.
"Our core markets are challenged and macro-economic conditions are in flux right now," said Dion Weisler, HP Chief Executive. He also added that market continued to be volatile, facing tremendous pressures and challenges.
HP expects adjusted profit for fiscal 2017 to be $1.55-$1.65 per share. Analysts on average had expected $1.61 per share, according to Thomson Reuters I/B/E/S.
Raising its quarterly dividend by 7 percent, HP also said it would increase its share buyback program by $3 billion. The company expects restructuring and other charges of $350 million to $500 million and the move is expected to generate gross annual run rate savings of $200 million to $300 million beginning in fiscal 2020, HP said to Reuters.
According to research firm Gartner, Inc., worldwide PC shipments totaled 68.9 million units in the third quarter of 2016, a 5.7 percent decline from the third quarter of 2015. This was the eighth consecutive quarter of PC shipment decline, the longest duration of decline in the history of the PC industry. "There are two fundamental issues that have impacted PC market results: the extension of the lifetime of the PC caused by the excess of consumer devices, and weak PC consumer demand in emerging markets," said Mikako Kitagawa, principal analyst at Gartner.