HP Inc. to Cut 3,000 to 4,000 Jobs in the Next Three Years; Provides Fiscal Year Outlook
HP Inc., which focuses on PCs and printing, reports that it will cut about 3,000 to 4,000 jobs over the next three years. In a filing with U.S. Securities and Exchange Commission, HP Inc. stated:
“HP expects approximately 3,000 to 4,000 employees to exit between fiscal 2017 and fiscal 2019. The changes to the workforce will vary by country, based on local legal requirements and consultations with employee works councils and other employee representatives, as appropriate.
In connection with the plan, HP anticipates incurring approximately $350 million to $500 million in restructuring and other charges due to both labor and non-labor actions. Of these amounts, HP expects to incur approximately $200 million in labor costs related to workforce reductions.”
Today at HP Inc.’s 2016 Securities Analyst Meeting, HP also provided details on its strategy, along with its outlook for 2016.
“I’m proud of the progress we have made in our first year as the new HP. Our focus is clear, our execution is solid, and we are positioned well for the next step in our journey,” said Dion Weisler, president and CEO of HP Inc. “We are confident in our strategy and believe it will continue to produce reliable returns and cash flow, while also enabling HP to invest in differentiated innovation and long-term growth.”
Weisler added, “Although our markets remain very challenged, we are committed to innovating in the core and continue to see long-term growth opportunities in commercial mobility and services, the disruption of the A3 copier market, and the digitization of graphics and manufacturing through our leading 3D-printing solutions.”
Fiscal 2017 outlook
For fiscal 2017, the company estimates net earnings per share to be in the range of $1.47 to $1.57 and estimates non-GAAP (Generally Accepted Accounting Principles) net earnings per share to be in the range of $1.55 to $1.65.
HP Inc.’s 2017 non-GAAP net earnings per share estimates exclude after-tax costs primarily related to items such as restructuring and other charges, defined benefit-plan settlement charges, non-operating retirement-related credits/(charges), tax indemnifications, net-valuation allowances, separation taxes and adjustments, acquisition and other related charges, discontinued operations, and amortization of intangible assets.
HP anticipates generating cash flow from operations of approximately $2.8 to $3.1 billion in 2017. With about $0.5 billion in net capital expenditures, free-cash flow outlook is in the range of $2.3 to $2.6 billion for fiscal 2017.
HP expects to return 50 to 75 percent of annual free cash flow to shareholders through a combination of a “robust dividend and regular share buy backs.” In fiscal 2017, the company indicated that it expects to be at the higher end of that range, with a 7-percent increase in the planned quarterly dividend amount, and the balance returned to shareholders through share repurchases. HP also announced an increase in its share repurchase program of $3 billion.
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