SAN FRANCISCO — Hewlett-Packard is bracing to slash an additional 11,000 to 16,000 jobs after it announced a dip in revenue for its second quarter.
The computing giant, which is in the midst of a long restructuring program by CEO Meg Whitman, on Thursday said revenue was down 1%, to $ 27.3 billion, from the same quarter a year ago.
HP had previously announced plans to cut 34,000 jobs.
The company employs about 317,500 worldwide.
HP posted earnings of 88 cents per share, excluding items. Analysts had expected the earnings of 88 cents a share on $ 27.41 billion in revenue, according to a consensus estimate from Thomson Reuters.
The total layoffs are roughly twice what Whitman initially anticipated when she undertook a five-year turnaround plan at HP in late 2011.
“We don’t anticipate an additional (layoff) program,” Whitman told USA TODAY on Thursday. “This company has been through a lot. … This is part of the program of integrating (major acquisitions), streamlining and automating processes.”
“We feel good at the midpoint of our (five-year) turnaround plan,” Whitman said. “Stabilization of revenue, cash flow, network security, big data, innovation, R&D spending — I feel good about where we are.”
Shares of HP were flat in after-hours trading, at $ 31.78. The company’s shares touched a 52-week high of $ 33.90 in early April.
HP made its name and fortune as a pioneer in business computing. But it has struggled the past few years to finesse the transition to mobile devices and the growing demand for cloud computing systems.
While corporate rivals such as IBM have retreated from the low-margin hardware market, HP has bolstered its computing hardware business. Yet on Thursday, HP said revenue for its enterprise group, which sells computer servers and other hardware, slipped 2% to $ 6.66 billion in the second quarter. In the previous two quarters, that group grew.
“The layoffs make a lot of sense, given they aren’t currently able to drive their services business like they would prefer,” says Patrick Moorhead, principal analyst at Moor Insights & Strategy.
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