HP to slash 24,600 jobs following EDS buy

Hewlett-Packard on Monday announced plans to cut tens of thousands of jobs over the next three years as it digests its recent purchase of EDS.

The company expects to replace roughly half of these positions over the next three years to create a global workforce that has the right blend of service delivery capabilities to address the diversity of its markets and customers worldwide.

HP announced plans in May to acquire the computer services firm for $13.9 billion. The deal closed in August. The company said that, once it has finished with the cuts, it expects the moves to save $1.8 billion in costs annually. It said it does plan to reinvest in other areas.

On the accounting side, HP said it will record a $1.7 billion charge in the fourth quarter of fiscal 2008 related to the restructuring program. The company said that, of that charge, $1.4 billion will be recorded as goodwill, and $300 million will be recorded as a restructuring charge that will be included in its financial results.

The company positioned the announcement as part of an effort to "streamline" its costs. It plans to discuss the move at an analysts' meeting, set to kick off shortly.

"HP now has the broadest technology capabilities in the market to meet customer needs today and in the future," CEO Mark Hurd said in a statement. "HP has a strong track record of making acquisitions and integrating them to capture leading market positions. We will deliver on the promise of HP and EDS for our customers and shareholders." HP discussed the job cuts as part of a meeting under way for financial analysts.

[Laserdisc]

Well I wish them good luck with EDS. I've had numerous dealings with EDS over the years at various corporations and it was never good.

[gggg sssss]

but they ARE good at cat herding (Hurding???)

[Vegaman_Dan]

HP is very good at outsourcing. They use multiple companies in India for their call center services.<p>
Now those companies it hires in India do have some issues, but that's another story.

[Freedom_Hound]

I am an EDS employee. I was just told today that starting Jan 1, EDS an HP Company will no longer fund the EDS pension. But the superior 401k match of HP would make up for it. After crunching the numbers of my "total compensation" this represents a 2.5% reduction in compensation. I wondered why, and then I found this:

"Ronald A. Rittenmeyer, the new CEO of Electronic Data Systems Corp., received compensation of nearly $14 million for 2007, a 10-percent increase reflecting his promotion and the company's increased profit even as its stock price dropped, reports the Associated Press."

and this:

HP Key Executives
Mr. Mark Hurd , 51
Exec. Chairman, Chief Exec. Officer and Pres $ 14.77M
Ms. Catherine A. Lesjak , 49
Chief Financial Officer and Exec. VP $ 2.24M
Ms. Ann M. Livermore , 49
Exec. VP of Technology Solutions Group $ 10.45M
Mr. Vyomesh Joshi , 54
Exec. VP of Imaging & Printing Group $ 6.75M
Mr. Shane V. Robison , 53
Chief Strategy and Technology Officer and Exec. VP $ 7.31M

Now I understand. They needed my paltry allowance for their lifestyles!!!