HP Inc. said that it should lay off 4,000 to six,000 employees in favor of AI deployments, claiming it should help save $1 billion in annualized gross run rate by the tip of its fiscal 2028.
HP expects to finish the layoffs by the tip of that fiscal 12 months. The reductions will largely hit product development, internal operations, and customer support, HP CEO Enrique Lores said during an earnings call on Tuesday.
Using AI, HP will “speed up product innovation, improve customer satisfaction, and boost productivity,” Lores said.
In its fiscal 2025 earnings report released yesterday, HP said:
Structural cost savings represent gross reductions in costs driven by operational efficiency, digital transformation, and portfolio optimization. These initiatives include but are usually not limited to workforce reductions, platform simplification, programs consolidation and productivity measures undertaken by HP, which HP expects to be sustainable within the longer-term.
AI blamed for tech layoffs
HP’s announcement comes as staff in all places attempt to decipher how AI will impact their future job statuses and job opportunities. Some industries, resembling customer support, are expected to be more disrupted than others. But we’ve already seen many tech layoffs tied to AI.
Salesforce, for instance, announced in October that it had let go of 4,000 customer support employees, with CEO Marc Benioff saying that AI meant “I want less heads.” In September, US senators accused Amazon of blaming its dismissal of “tens of hundreds” of employees on the “adoption of generative AI tools” after which replacing the employees with over 10,000 foreign H-1B employees. Last month, Amazon announced it will lay off about 14,000 people to deal with its most promising projects, including generative AI. Last 12 months, Intuit said it will lay off 1,800 people and replace them with AI-focused staff. Klarna and Duolingo have also replaced significant numbers of staff with AI. And in January, Meta announced plans to put off 5 percent of its workforce because it looks to streamline operations and construct its AI business.