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This Is Why Hewlett-Packard Just Fired Another 30,000
Remember when Hewlett-Packard announced it would fire 58,000 in February just so the company could spend even more billions on stock buybacks to make its shareholders filthier rich?
Alas, since then things have gone south not only for HPQ stock but also for the company's buybacks activity...
... and so Meg Whitman clearly needed to spend even more on buybacks. But where to get the money? Wait, here's an idea: lets fire another 30,000!
Sure enough, just out from Bloomberg:
- HPE CFO SEES 2.7BN RESTRUCTURING LEADING TO 25K-30K JOB CUTS
- HP: BY 2018 40% OF ES EMPLOYEES WILL BE IN HIGH-COST LOCATIONS
More details from Bloomberg on the latest restructuring bloodbath out of Hewlett-Packard :
- sees FY16 FCF $2b-$2.2b, with normalized FCF $3.7b.
- Sees FY16 adj. EPS $1.85-$1.95
- Sees FY16 operating cash flow $5b-$5.2b
- Sees cutting 25k-30k jobs as part of restructuring, with GAAP charges $2.7b
- Sees returning at least 50% of FCF to holders through ~$400m in dividends and the remaining in share repurchases
- Says will consider strategic partnerships, investments and M&A “in the right circumstances”
- Earlier, co. said sees HPE cloud rev. ~$3b in FY2015 growing over 20% with similar pace expected over next “several years”
- Said enterprise services business on target for 7%-9% oper. margin target and for reducing $1.4b in costs for 2015; sees similar cost reduction pace continuing next year
And so, dear 30,000 formerly-well paid computer engineers and technicians: welcome to the fast-food recovery. And don't forget to BTFD with all that spare cash.
Now, where is that 25bps rate hike because the economy is just too strong...
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I worked there for a while and it was total garbage. There are still some great folks around, but they are getting paid less and less, and having to work longer hours for less pay while reporting to God knows who, often a foreigner with crappy engrish skills, yes likely another 'diversity hire'. People with DEEP knowledge, decades and decades, have either gotten unfairly fired or demoted, made to quit, or if they are lucky, taken some early retirement and GTFO (along with their expertise - whoopsie! who knew? unintended consequences are a bitch aren't they? )....
If you look on a site like LinkedIN, it will always say 'We're hiring!'. YES, HP is hiring.....but not YOU, they want Ganesh Balasubramaniamawapbapalooboopawapbamboomtuttifrutti, so that they can work him as modern day slave labor for ultra cheap. We can thank idiot 'leaders' like Meg Pasty Faced Whitman and Bill 'Forced Vaccinations' Gates for lobbying Congress for decades, against the rights of American workers.
Remember that Meg 'Pasty Faced' Whitman is the person who came up with the idea of a 'lights out' datacenter....that's right, it's the concept of putting all of your computers in a building, in racks, in the dark, and maybe hiring an intern to come in once a month and keep them going. This is what she actually believed. Along with her other statement to the HP workforce which says basically that the future of HP is one of total automation.....TRANSLATION: If you are a smart admin, engineer, project manager, architect, sw tester, etc.....we (HP management) think you are an IDIOT and can be replaced by a robot, a foreigner, or any other cheap worker.
Race to the bottom is like they say a space ship approaching a black hole......after a while the laws of physics and common sense, just don't apply anymore.
My husband was also considering a position there years back and even then we were told by others int he filed to stay clear. We are glad he did not go there but chose to come to Singapore instead.
An era of leadership in computer technology has died, and there is no grave marker, not even a funeral ceremony or eulogy ... Hewlett-Packard, COMPAQ, Digital Equipment Corp, UNIVAC, Sperry-Rand, Data General, Tektronix, ZILOG, Advanced Micro Devices, Sun Microsystems, etc, etc, etc. So much change in so short a time, leaves your mind dizzy.
Sad, isn't it.
At least there's still Linux, even if we have to run it on imported Chinese brands.
yes, and to make the story the ultimate irony, LINUX was created by a student and is maintained as freeware
I am soooooooooooooo happy that I do not have to seek a career in the current environment.
Jump, you bastards!
I bought an HP table that became worthless after just a few months. The usb charge port broke and was impossible to get fixed though the HP circle jerk, poor command of english customer service bureaucracy.
We have chopped down the Nations tree of prosperity and tree of freedom and pulled their stumps out of the ground. There is nothing left to save. Its over with.
"The Giving Tree"
https://www.youtube.com/watch?v=1TZCP6OqRlE
HP doesn't sell tables.
Firing 30,000 people is the best thing that ever happened to them.
People in large corporations don't do any work. Most employees, come in, get their coffee, read their email, go on break, get more coffee, go to lunch, go to a meeting (the big event of the day), go on break, go home. Yeah, we're talking about you.
Time to go to work.
Fire 30,000 American employees.
Hire 30,000 people in Taiwan or India willing to work for 20 dollars a month.
????
PROFIT!!!!
well, i guess you could either piss it away on employees who aren't going to make a profit or give it to the people who actually own the fucking company!!!!!!!!! if these folks made money they would not be getting shit canned, pretend it's your money
Stock buybacks are just a pump-and-dump for the short run. They are a total waste of money in the big picture.
I worked for LC Penney when they did a huge buyback. It "would create value for our sharholders", they said. Now their sotck is in the single digits ( I sold mine at $82). They should have put the billions into updating their creaky, inefficient supply chain.
Doesn't this many layoffs require a bailout? These companies being so large are great for the economy. Promotes nepotism, reduces headcount, stifles innovation. /sacrciusm
Or maybe they're just a failing company, trying their last to cut what they think they might be able to withstand. Like any company.
Alas, American people consider the ex CEO of hp who drove the company into the ground and was such a bad CEO she was removed and the Board paid her as apart of her contract to leave.
It seems like the worst of us run for president.
I worked closely with HP in the days of the PA-RISC processor which laid waste to anything Intel ever had at the time. The HP 9000 HP-UX mini-computers and workstations where some models were so powerful they were not be sold to the Chinese (at the time). Bill and Dave, the founders ran the company, the company had a savy tech culture that led the industry kicking DEC's ass out of the business and eventually buying Compaq. These were the days before they split off the instrumentation division now known as Agilent. When Bill and Dave were at the helm HP bragged they would not lay off people but ask everyone to take a small pay cut during a short market downturn and the employees agreed. People cared for each other in the company. When Bill and Dave left the helm it went down hill quickly, supply chains were broken and moved to the cheapest labor market, quality suffered but the stock was strong, the insiders saw the writing on the wall. HP is hollow shell of what it was, in fact I will go as far as to say that today it is a gutless paper tiger that is barely a shadow of the tech giant it was. It is the same story for all of our American tech manufacturers, they have sold out to cheap Asian labor and the R&D they claimed would stay in the USA also eventually went to China. It is never coming back and it is a very good reason to be angry at how Wall Street CEO's are nothing but robber barons that have destroyed America's tech greatness, there will be no more Bill Hewlett's and Dave Packard's because they and the following generations were sold out to the lowest bidder to line the pockets of Wall Street shills.
I have avoided HP products like the plague for many years, except I fell into temptation and bought an HP lasejet which I had an unbelievable amount of trouble with. So much for federally mandated girl power AKA Affirmative Action.
Ditto.
They used to be the best at everything they did. My experience goes back to their first amazing RPN scientific calculatore in the late 70s.
Now everything they make is crap.
30,000 middle class and upper class jobs.
Motherfucking executive suite.
We have all been fired.
Some of us haven't been notified yet.
Are those manufacturing jobs in China or are they in the US?
I know it's only one facet of their operations, like data hosting, but who the fuck purchases HP computers and hardware at the prices they charge? Let's take a Gaming PC, buy your case, power supply, ram, hard drive, DVD-CD drive, motherboard, processor and CPU fan and for the same spec save yourself £200-300. It's no more difficult than putting together LEGO pieces, but this isn't what is going to kill HP.
The death of HP will come with the onset of a central bank interest rate rise to anything approaching historic norms. Even with central bank ZIRP and HP's ability to borrow money around 1% to conduct share buy-backs, HP still has to haemorrhage jobs to keep the Ponzi scheme and charade going. But HP is not alone. More than half of the S & P 500 companies are engaged in share buy-backs, distorting the real market cap of these companies. HP is in just as fucked as Motorola. Nothing is real in the west anymore. Everything around us is a fucking lie and the lies start at the top. That is the only thing that genuinely trickles down from the wealthy and permeates societies. Lies, lies and more lies.
Forget STEM. If I were a student and had any interest in economics, I would demand that my educational institution offer a biography course on DENNIS GARTMAN. To focus very much on his reasoning process and interpretation of economic and market information.
Because there is no better gig that comes to mind than being wrong 100% of the time and being well paid for it.
(oh, the biography course should also include a segment on how to market being wrong as well as Gartman does).
HP used to be a great engineering company before it became an ink business
Do they really think there will be no blowback when they sell ink cartridges for more than the printer? HP mail goes straight to my spam folder and I'll never buy an HP product again.
What a stupid post. There is no required linkage between opportunistically using excess cash to buy up stock that mnanagement considers undervalued, and the ongoing expense reduction program that will increase profits in the future.
In an international business, layoffs in one area of the company might be combined with hiring in a lower-cost area. HP isn't talking about that.
There is also no linkage between the USD interest rate and the state of the US economy. The bad employment situation in America is the result of high taxes and regulation, not interest rates.
Jeez, this place is become as irrational as Democratic Underground.
contrarian, let me be the first to say, you dick. if only your last 2 sentences were posted you would of got an up vote, but the first few make you a dick.
We are the champions
I guess they are simply not friend enough to the right american politicians. Anyway it won't take too long till we got indispensable IT-manufacturers.
These stock pump and dump schemes suck. I hope they get a TON more bad press, and don't make near what they wanted on this weirdly recursive buyback crap. Reminds me of the IPO of everyone's friend FASCbook......CEO and a handful of others artifically inflated the price, then <extracted a ton of cash for themselves>, then 'voila'! The stock price is now 'normalizing' after a bit of time.
Sounds great, except it's basically fraud.....all those investors who thought they were getting in on a piece of the action, basically were dividing their investment into part A 'pump and dump to the higher ups' and part B , the actual stock itself.
Fuck these companies, and fuck their stocks in their stock-asses.