Hewlett Packard Enterprise (HPE), headquartered in Spring, Texas, announced plans to reduce its global workforce by approximately 5%, equating to about 2,500 jobs, over the next 18 months. This decision aims to curtail operating costs following underwhelming economic performance.
The company employs around 2,000 individuals in the Houston area, though it remains unclear how many local positions will be affected. The workforce reduction program received board approval on Thursday and was confirmed during HPE’s first-quarter earnings call on Friday.
CEO Antonio Neri acknowledged operational shortcomings, stating, “We could have executed better.” He highlighted challenges within HPE’s server unit, noting a rapid shift in demand for the latest graphics processing units has led to an excess inventory of older models.
The company anticipates annual savings of approximately $350 million from these cuts, with full financial benefits expected by fiscal year 2027. HPE’s Chief Financial Officer, Marie Myers, also expressed concerns regarding new tariffs on imports from Mexico and Canada, which could impact the company’s financial outlook in the coming year.
In 2020, HPE relocated its headquarters from San Jose, California, to Spring, Texas, and currently employs over 60,000 people worldwide. The company specializes in servers, data storage systems, networking equipment, software for managing IT infrastructure, and consulting services.
This workforce reduction follows HPE’s 2015 split from Hewlett-Packard, which divided the personal computer and printer businesses into HP Inc., while the enterprise segment became Hewlett Packard Enterprise.
The specific impact of these layoffs on the Houston area workforce has yet to be determined.