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Tech giant HP has outlined a far-reaching workforce overhaul that will eliminate between 4,000 and 6,000 global roles by fiscal 2028, linking the reductions to an effort to simplify its structure and expand the use of artificial intelligence across the business.
Chief Executive Enrique Lores told reporters that the company will channel its AI investments into product development, internal processes and customer support. He said the shifts will reshape how the company works and where staffing is required.
“We expect this initiative will create $1billion in gross run rate savings over three years,” Lores said during a media briefing. He added that HP is aiming to speed up product cycles and improve service delivery as more teams adopt AI tools.
The cuts follow an additional round of layoffs earlier this year, when HP removed 1,000 to 2,000 jobs under a previously announced restructuring program. The new plan widens that effort, signaling a long-term redesign of its operational footprint.
Rising AI demand reshapes PC shipments
AI-enabled PCs are gaining momentum across the market, with demand climbing throughout the year. HP said that the devices accounted for more than 30% of its shipments during the quarter ending October 31, a shift it expects to continue as businesses and consumers upgrade hardware to support new AI workloads.
Analysts at Morgan Stanley have warned that a surge in memory chip prices, driven largely by heightened demand from data centers, could squeeze margins for manufacturers including HP, Dell and Acer. The competition among infrastructure providers to build AI capacity has pushed up costs for dynamic RAM and NAND components, key inputs for PCs and servers.
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Chip costs expected to rise into 2026
Lores said HP anticipates feeling the impact of those increases during the second half of fiscal 2026. The company has sufficient supply for the first half but is preparing for higher pricing later in the year.
“We are taking a prudent approach to our guide for the second half, while at the same time implementing aggressive actions like qualifying lower cost suppliers, reducing memory configurations and taking price actions,” he said.
The company framed the job cuts, supply-chain adjustments and AI initiatives as part of a unified strategy to manage rising component costs while staying competitive in the next cycle of PC and enterprise hardware demand.
