HP Inc. (NYSE: HPQ) is undertaking another massive restructuring of its business and will reduce its global workforce by about 16 percent as part of the plan. The company currently has about 55,000 employees worldwide, according to the latest filing with the US Securities and Exchange Commission. That means that 7,000 to 9,000 employees could be impacted.
The Palo Alto, Calif.-based computer and printing giant says that the job cuts will occur through a combination of employee exits and voluntary early retirement. It is believed that most of the reductions will occur in the back-office support functions and at the corporate headquarters. The line functions may be spared the job cuts.
The company estimates that it will incur total labor and non-labor costs of approximately $1 billion in connection with the restructuring and other charges. The reduction in workforce may result in a total saving of about $1 billion spread over three years. The restructuring is expected to be completed in fiscal year 2022.
The workforce reduction is just one of many changes coming to the company in the next several months. Enrique Lores will take over at HP as the new CEO on November 1 when the current incumbent Dion Weisler leaves. Tuan Tran will take over as president of HP’s printing business.
HP is also planning to make changes to the way it sells its products. For example, the company is expected to increase the prices of its hardware, with a particular focus on printers that are compatible with cartridges other than HP. Customers will have to make a choice between paying more for an unlocked printer and use the ink of their choice, or pay less for a locked printer that can only use HP printer-ink refills. The supplies business, made up mostly of ink cartridges, is HP’s biggest profit generator.