Key Takeaways
- HP is laying off between 4,000 and 6,000 employees around the world by fiscal year 2028, as it looks to AI to boost its fortunes.
- Teams that focus on internal operations, product development, and customer support, will be the most heavily impacted.
- Across the tech sector, companies are replacing workers with AI — and sometimes, not getting the results that they had hoped.
HP is set to lay off between 4,000 and 6,000 jobs globally by 2028 as it gears up to embed AI into its workflows and processes. The company announced this week that it was hoping to use the technology to streamline operations, improve customer satisfaction, and ultimately boost productivity.
As revealed by CEO Enrique Lores during a media briefing call, teams that focus on product development, internal operations, and customer support will be heavily impacted by the cuts. This is the second round of layoffs that HP has made in 2025, with around 1,000 to 2,000 employees let go in February.
It’s been a turbulent year for the tech sector, with companies everywhere replacing workers with AI in a bid to avoid being cut adrift. However, research shows that businesses should properly think through their adoption strategies before they implement them. Otherwise, they risk accruing costly and damaging “AI debt.”
HP to Lay Off Thousands of Staff in AI Pivot
Computer giant, HP, plans to lay off between 4,000 and 6,000 members of staff around the world by fiscal year 2028, the company revealed. The layoffs form part of a wider plan to streamline operations, boost efficiency, and improve customer satisfaction, all through the deployment of AI.
Reportedly, teams that focus on product development, internal operations, and customer support, will be most heavily impacted. CEO Enrique Lores said in a media briefing call that he expects the move to create “$1 billion in gross run rate savings over three years.”
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This round of cuts comes off the back of a similar move in February, in which HP let go of between 1,000 and 2,000 employees as part of a previously announced restructure.
Consumer Demand for AI Tech Forces HP’s Hand
Partly, the move is driven by external demand for AI-enhanced computers and laptops. In the quarter ending October 31, this accounted for more than 30% of HP’s shipments globally.
The knock-on effects of this market shift have been huge. As consumer demand has increased, so too has the price of memory chips, including both dynamic random access memory and NAND chips. HP expects to feel the pinch brought on by these increases in the second half of fiscal year 2026.
Said Lores: “We are taking a prudent approach to our guide for the second half, while at the same time taking aggressive actions like qualifying lower cost suppliers, reducing memory configurations, and taking price actions.”
AI Continues to Reshape Big Tech
As 2025 draws to a close, it’s been a momentous year for AI in the tech space. Right across the sector, companies big and small have raced to embed and deploy the technology at scale, with a focus on optimizing back office operations and boosting customer satisfaction.
Inevitably, this has changed the way that everyday employees go about their business, with half of HR execs now using AI to hire top talent. While the upsides are obvious, companies should be mindful that AI is not the silver bullet that many had hoped — and incorrectly deploying it can be a disaster.
“AI debt” is the name given to the costs that pile up when companies fail to appropriately prepare for the rollout of AI. These can be reputational, resource-oriented, or financial, and the consequences can be severe. Before your business acts, it’s important to have a solid adoption framework in place. Otherwise, you risk becoming the latest high-profile AI gaffe.
