HP plans to cut 27,000 jobs

Hewlett-Packard said today it would eliminate 27,000 jobs as the bellwether technology giant restructures its business to cut costs.

The job cuts represent 8 percent of its work force, and would be completed by the end of fiscal 2014, the company said today.

In addition, HP will reduce expenses by streamlining the supply chain, narrowing its product portfolio, simplifying its market strategy and improving its standard business practices. The cuts are expected to generate savings of $3 billion to $3.5 billion after fiscal 2014. The savings will be reinvested in the company, HP said.

HP is in uncertain waters after its former CEO, Leo Apotheker, attempted to transform the business into an enterprise-only operation during his short tenure. Current CEO Meg Whitman opted to keep the consumer business, but has set her own stamp on the business with the dramatic cuts.

The moves will HP remain nimble, simplifying how the business operates and allowing the company to focus on growth areas such as cloud, big data, and security.

“While some of these actions are difficult because they involve the loss of jobs, they are necessary to improve execution and to fund the long term health of the company,” Whitman said in a statement today.

HP will record a pre-tax charge of $1.7 billion in fiscal 2012 to account for the restructuring. Through fiscal 2014, the company expects to record additional pre-tax charges of approximately $1.8 billion.

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