HP Inc. Announces Further Restructuring and Up to 4,000 Job Cuts as Company Turns More Towards 3D Printing
One of the biggest pieces of 3D printing news this year has been the entrance of HP into the 3D printing market – or maybe conquering would be a better word. The company made major waves when they unveiled their Multi Jet Fusion 3D printer earlier this year, and since then they’ve been rolling across the industry like a snowball, gathering up other companies as they go. It’s been a good year for the multinational corporation and their new 3D printing business, but like so many good things, there’s a downside to HP’s forward momentum.
The consumer division of HP has announced that they plan to cut up to 4,000 jobs in the next three or four years. It’s an unfortunate side effect of a changing market – as technology advances, other technology falls behind, causing companies to need to adapt, shift, and adapt again. While HP may be surging forward with 3D printing, their other product lines, such as 2D printers and personal computers, are slowing down.
The announcement comes nearly a year after HP split into two separate companies – HP Inc., which has continued to develop a new 3D printing system along with their other product staples, and Hewlett Packard Enterprise, which focuses on workplace productivity and cloud solutions. The split came with thousands of layoffs, and as HP Inc. continues to see demand for their non-3D-printing-related/non-digital product lines dropping, more jobs are falling victim to the shift towards newer technology.
“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 digitisation of graphics and manufacturing through our leading 3D printing solutions,” 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.”
In August, HP Inc. revealed their third quarter earnings: net income of $843 million on $11.9 million in revenue, a drop of four percent year over year. The decline coincides with an overall drop in 2D printing and PC sales; printing net revenue was down 14%, while the total sale of printer units fell 10%. The 2D consumer printer market was hit the hardest at 14%, while commercial printer revenue only declined by 2%.
The staff cuts, which Weisler said will affect multiple departments across the company, is expected to save HP between $200 and $300 million from the start of fiscal year 2020. The board is also expected to outlay about $350 to $500 million in restructuring and related costs.
It’s an unfortunate trend we’ve seen with other companies as they rebuild themselves around new technology. Advances in new areas mean decreases in others as new technology replaces old, and no company remains completely unscathed, even when their futures look bright. Overall, though, HP should emerge as a stronger company, and one that will be a prominent market force in the 3D printing world for years to come. Discuss in the HP Restructuring forum at 3DPB.com.[Sources: HP, ZDNet]
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