Hewlett-Packard gave a disappointing outlook for full-year revenue and said it will lay off another 2 per cent of its workforce as consumers and businesses cut spending on computers, printers and services.
The mew round of layoffs - which total roughly 6,400 jobs - announced last night are on top of previously announced cuts from integrating the operations of IT services company EDS, which HP acquired last year.
HP said the job cuts will come in its product segments, such as PCs and printers. The reductions will happen over the next 12 months.
The company employs over 4,000 people in Ireland at facilities in Dublin, Leixlip, Galway and Belfast and recently announced plans to create 500 new jobs over the next 12 months at its Liffey Park Technology Campus in Leixlip, Co Kildare.
It is unclear what if any impact the company's announcement will have on its Irish operations.
HP, which vies with smaller rivals Dell and Acer in a depressed global PC market, also expects fiscal year revenue to slide 4 per cent to 5 per cent compared with a previously forecast of 2 per cent to 5 per cent, offering a more pessimistic view of 2009.
The company's services business was the largest by revenue in the quarter, boosted by the EDS buy. PC revenue fell 19 per cent, imaging and printing revenue dropped 23 per cent and storage and server sales sank 28 per cent.
Analysts said the company is doing a good job controlling costs in a difficult environment, but said investors may be spooked in the absence of more upbeat comments from chief executive Mark Hurd.
Although Hurd did point to pockets of improvement, he told Reuters in an interview that in terms of demand: "We're expecting roughly more of the same".
Frost & Sullivan analyst Ron Gruia said Hurd is approaching the demand question very carefully. "He does show a little bit more cautiousness and maybe it's better to be a bit more cautious in this environment."
The shares of the technology bellwether, which some analysts deem a safe haven in the downturn because of its diverse portfolio, fell as much as 5 per cent in after-hours trading.
HP's stock is roughly flat for the year, compared with a 25 per cent rise for International Business Machines Corp and a rise of more than 10 per cent for Dell.
HP reported a net profit of $1.7 billion, or 70 cents a share, in the fiscal second quarter ended April 30th, down from $2.1 billion, or 80 cents a share, a year ago.
Excluding certain restructuring and acquisition-related items, HP posted a profit of 86 cents a share, matching analysts' average forecast, according to Reuters Estimates.
Revenue slipped 3 per cent to $27.4 billion, a whisker off Wall Street's forecast of $27.5 billion.
For the current quarter, HP forecast earnings, excluding items of 88 cents to 90 cents a share, with revenue flat to down 2 per cent sequentially.
Reuters