HP announced Tuesday that it will cut 4,000 to 6,000 jobs by the end of 2028 as it gears up to fully focus on AI.
The computer and printer company announced cuts to its earnings report. Implementing this change is estimated to save approximately $1 billion by 2028. The company estimates that it will incur approximately $650 million in costs related to the restructuring, of which approximately $250 million will decrease in fiscal year 2026.
HP’s strategy is to “advance and enable artificial intelligence to drive customer satisfaction, product innovation, and productivity,” and to achieve cost savings through “headcount reductions, platform simplifications, program consolidation, and productivity measures,” according to the company’s earnings release.
“Two years ago, we started piloting how AI could help drive these things,” HP CEO Enrique Lores said on an earnings call. “What we’ve learned is that we need to start by redesigning the process. Once we figure out how to use AI to re-engineer the process, we can use genetic AI to have a really big impact.”
He added later in the call that the company “ended 2025 on a strong note, with profits increasing from the first half to the second half.”
“We intend to outpace the market in 2026,” he added. “We have a significant opportunity to transform our company by incorporating AI into everything we do.”
The company exceeded sales expectations in the fourth quarter. However, Bloomberg analysts expect the company’s 2026 EPS to be $3.32, while HP estimates non-GAAP net diluted EPS in the range of $2.90 to $3.20, which is below analyst expectations.
HP’s stock price was down more than 5% in after-hours trading at the time of publication, and is down more than 25% year-to-date.
Business Insider previously reported that the era of AI-driven layoffs has hit white-collar industries particularly hard, with companies like Amazon and Workday announcing significant layoffs related to advances in artificial intelligence.
