HP Cuts Up to 6,000 Jobs by 2028 as AI Pivot Reshapes the Tech Workforce

The Numbers Behind the Pivot

HP's full-year fiscal 2025 revenue reached $55.3 billion, a 3.2% year-on-year increase, and fourth-quarter revenue of $14.64 billion beat analyst expectations of $14.48 billion. On the surface, the company is growing. The restructuring, then, is not a distress signal; it is a deliberate reallocation of capital from headcount toward AI infrastructure and product development.

AI-enabled PCs now account for more than 30% of HP's quarterly shipments, with that segment doubling its revenue contribution over the past year. CEO Enrique Lores was direct about the rationale: "It's something we have to do to make sure the company stays competitive," he said, pointing to the company's plan to embed AI across product development, customer support, sales, and manufacturing operations.

CFO Karen Parkhill reinforced the message: "A significant opportunity ahead to embed AI into almost all that we do to improve productivity, accelerate innovation and improve customer experiences."

Yet the forward guidance was cautious. HP projects adjusted earnings per share of $2.90 to $3.20 for fiscal 2026, below the analyst consensus of $3.33. First-quarter adjusted earnings are expected between 73 and 81 cents per share. That conservatism triggered a 5.5% drop in HP's share price during extended trading.

What the European Tech Sector Should Take From This

HP's move does not happen in isolation. Across the EU and UK, technology employers are running the same calculation: where can AI replace or reduce human labour costs, and how quickly can that saving be reinvested in AI capability? The European context adds regulatory complexity that American firms operating here cannot ignore.

The EU AI Act, now in its implementation phase, imposes obligations on high-risk AI deployments, including those affecting employment decisions and worker monitoring. Andrea Renda, senior research fellow at the Centre for European Policy Studies in Brussels and one of the EU's most cited AI policy analysts, has argued consistently that the Act's requirements around transparency and human oversight will force companies to document the role AI plays in restructuring decisions. That is a meaningful constraint that HP's European operations will need to navigate as cuts are implemented across the continent.

Meanwhile, the OECD's AI Policy Observatory, which operates partly out of Paris and coordinates closely with European member states, has tracked AI-attributed job displacement rising sharply. Its data shows that the pattern is not confined to lower-skilled roles. Customer service, data processing, and certain programming functions are already being automated at scale, and administrative middle management is increasingly in scope.

Which Roles Are Most Exposed

HP's own framing points to specific operational areas being restructured around AI tools. Based on the company's stated deployment priorities and broader industry patterns, the roles facing the highest displacement risk include:

• Customer support representatives, replaced or substantially reduced by AI chatbots and automated resolution systems
• Data entry and processing clerks, automated through machine learning pipelines
• Content moderation and quality assurance roles, supplemented or replaced by AI screening
• Junior programmers and testers, facing direct competition from AI coding assistants and automated testing
• Administrative and back-office functions, streamlined through process automation
• Routine manufacturing oversight positions, increasingly handled by AI-driven quality control systems

The displacement is not symmetric, however. Companies including HP are simultaneously expanding hiring in AI engineering, data science, and human-AI collaboration roles. The net employment effect across any given firm is genuinely uncertain, and anyone claiming otherwise is either selling something or has not read the research carefully.

Component Costs and Supply Chain Pressures

Alongside the AI narrative, HP faces a harder near-term problem: memory chip prices are rising sharply, driven by enormous data-centre demand as major technology firms expand their AI infrastructure. HP expects higher component costs in the second half of fiscal 2026 and has already begun seeking lower-cost suppliers and reducing memory configurations to protect margins.

The company has also shifted manufacturing for nearly all North American products to facilities outside China, in part to mitigate tariff exposure. European procurement and supply chain teams at HP's regional operations face a parallel version of this challenge, given ongoing EU trade policy reviews and the drive to onshore or nearshore critical technology manufacturing under the European Chips Act.

ASML, the Dutch semiconductor equipment maker whose lithography machines underpin global chip production, has noted publicly that demand signals from hyperscalers are distorting the broader memory market. That context matters for any hardware company, HP included, trying to price AI-capable products competitively over the next two years.

A Pattern Across the Industry

HP is not an outlier. The same restructuring logic has been applied at Google, Microsoft, and Amazon, each of which has reduced headcount in traditional operational areas whilst investing heavily in AI capability. What makes HP's announcement notable is its scale relative to a workforce that is already lean by comparison, and its explicit public linkage of job cuts to AI deployment.

Recent industry data cited across multiple sources puts AI as a contributing factor in more than 31,000 job cuts across all sectors during the first ten months of 2025, forming part of over 48,000 total technology-related workforce reductions. Europe's share of that figure is growing. The European Trade Union Confederation has called for binding consultation requirements before AI-driven restructurings can proceed, a demand that carries real legislative weight given the current composition of the European Parliament's employment committee.

The key question for European policymakers is not whether AI-driven displacement is happening; it plainly is. The question is whether the retraining and reskilling infrastructure exists to absorb the workers being reallocated. On current evidence, across Germany, France, and the UK alike, the honest answer is: not yet at the required scale.