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2mo ago

Hewlett Packard Enterprise to Cut 2,500 Jobs Following Weak Outlook and Tariff Challenges

The tech company plans layoffs and cost-saving measures as it faces declining margins, trade tariffs, and regulatory hurdles.

The Hewlett Packard Enterprise, with its campus in Spring, Texas, will be making layoffs
The Hewlett Packard Enterprise campus in Spring. The company said it would cut its workforce by about 5% over the next 18 months. 
Figurines with computers and smartphones are seen in front of Hewlett Packard Enterprise logo in this illustration taken, February 19, 2024. REUTERS/Dado Ruvic/Illustration/File Photo

Overview

  • Hewlett Packard Enterprise (HPE) announced a workforce reduction plan affecting 2,500 employees, representing 5% of its global workforce, over the next 18 months.
  • The company reported a 16% year-over-year revenue increase to $7.85 billion for Q1 2025 but issued revenue and earnings guidance below analyst expectations for the upcoming quarter and fiscal year.
  • HPE attributed its lower profit margins to increased inventory costs, aggressive discounting, and the impact of new U.S. tariffs on imports from Canada, Mexico, and China.
  • The company’s stock dropped nearly 20% after the announcement, marking its lowest level in over a year, as investors reacted to weak guidance and ongoing challenges in the AI server market.
  • HPE is also preparing for a legal battle with the Department of Justice over its proposed $14 billion acquisition of Juniper Networks, with a trial set for July 2025.