Analysts expect massive HP layoffs

[UpInArms]

http://news.zdnet.com/2100-9584_22-5715548.html

Hewlett-Packard is likely to lay off thousands more employees, financial analysts have projected after new Chief Executive Mark Hurd presented his inaugural assessment of quarterly earnings.

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"We expect that Hurd will likely articulate his detailed plan for improving HP sometime over the next two months, and we do expect material workforce reductions--likely numbering 5 percent to 10 percent of the workforce, or 7,500 to 15,000 people," Sanford C. Bernstein analyst Toni Sacconaghi said in a report. He estimated that doing so could increase annual earnings by 20 cents to 40 cents per share.

Merrill Lynch analyst Steve Milunovich predicted job cuts would be announced by August; he projected an earnings boost of 21 cents to 42 cents per share for a hypothetical reduction of 5 percent to 10 percent of employees.

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Massive job cuts have been more the rule than the exception in recent years at the Palo Alto, Calif.-based company. HP laid off thousands of employees under the plan by previous CEO Carly Fiorina to merge with Compaq Computer in an attempt to compete better against top rivals IBM and Dell.

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