HP will lay off 4,000–6,000 employees by 2028 as it increases AI use and reorganises operations. The company targets USD 1 billion in savings. Rising memory chip prices may pressure profits. AI PC demand is growing, but HP’s profit forecast for 2026 is weaker than expected.
HP Inc. has announced that it will lay off 4,000 to 6,000 employees worldwide by the end of fiscal year 2028. The company says this decision is part of its plan to reorganize operations and increase the use of Artificial Intelligence (AI). HP aims to use AI to speed up product development, improve customer satisfaction and increase overall productivity.
Teams That Will Be Affected
According to HP’s CEO Enrique Lores, the layoffs will mainly affect teams connected to product development, internal operations and customer support. Lores explained that the company expects to save 1 billion dollars over the next three years through this initiative.
Earlier in February, HP had already announced a restructuring plan under which 1,000 to 2,000 employees were laid off. At the same time, the demand for AI-based personal computers has increased rapidly. In the fourth quarter, more than 30% of HP’s total PC shipments were AI-enabled devices.
Rising Memory Chip Prices: A New Challenge
There is also concern about the rising global prices of memory chips. Analysts from Morgan Stanley have warned that because of the growing demand from data centers, the prices of memory chips may rise even more. This may put pressure on the profits of companies like HP, Dell and Acer.
Due to competition among big tech companies to build advanced AI infrastructure, the prices of DRAM and NAND chips have already increased.
Impact Expected in Fiscal 2026
Enrique Lores said that the impact of these higher chip prices will be felt in the second half of fiscal 2026. For the first half, HP already has enough inventory. The company is now taking a careful approach for the second half by choosing low-cost suppliers, reducing memory configurations, and taking pricing actions to manage costs.
