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HP Makes More Money, Cuts 16,000 Jobs
jfruh (300774) writes "Good news for HP: Profits are up by 18% over the previous year! Bad news for HP: A lot of those profits are from post-Windows XP PC upgrades, and company revenue actually dipped 1%. The solution, according to CEO Meg Whitman, is "continuous improvement in our cost structure," which means firing thousands of people. At the end of the next round of layoffs, the company will have shed 50,000 employees since 2012."
New submitter Deveauxes (3664417) links to a similar story from CNN's news service, according to which "HP said the latest layoffs would come across all its business units and geographic locations, and would generate $1 billion in annual savings beyond the $3.5 to $4 billion projected from the previously announced cuts. 'No company likes to decrease the work force, and we recognize that this is difficult for employees,' CEO Meg Whitman said in a conference call with analysts. 'I think everyone understands the turnaround we're in.'"
I thought that they still relocating entire offices to third world countries, and staffing them with people making $3 an hour to do your tech support calls. You can't get H1B's for that cheap!
What... you still want tech support that can actually understand English and isn't just navigating through a troubleshooting flow chart to "fix" your problem? You better pony up for the Gold level Enterprise support package for $$$$$$ a month.
They used to make really cool, quality stuff (Agilent Technologies anyone?) Now they're reduced to selling disposable printers and ink that costs more than vintage Dom. Gee thanks, Carly.
Almost right. Actually, it's upper management who gets wealthy in the name of "shareholder wealth". But yeah, too bad about the rest of the economy.
All of my calculators used to be HP, all of my bench equipment was HP or Tektronix. But these days, I no longer own an ink-jet printer, so I don't buy printer ink, so HP has nothing for me.
There are many brands that no longer represent their heritage: Philips, Zenith, Bell Labs, Kodak...
It's sad, but it's life, HP hasen't been a "high tech" company foe several years, they have been a "re-brander" of Chinese consumer products.
If you want news from today, you have to come back tomorrow.
It proves that if you can give a corporation tax breaks and throw off the shackles of regulation, they will do better and want to hire more people. Oh...wait.
Take the cheese to sickbay, the doctor should see it as soon as possible - B'Elanna Torres, "Learning Curve"
Since this was marked informative (thank you) I thought it would be fun to dig up the actual figures. It isn't quite as bad as I seem to remember, but I still think it's indicative of a company that pays far too much to CEO's that are either temporary, or fail to perform. Feel free to correct me where I've made a mistake, this isn't the type of thing I want to spend all night on, but perhaps someone would have fun finding their actual yearly salaries and bonuses.
CEO Carly Fiorina served from 1999 to 2005, since then it looks like HP has had 5 CEO's including the current one
Carly Fiorina - July 1999 to Feb 2005 - $20m severance
Robert Wayman - Feb 2005 to Mar 2005 - $3m cash bonus - Interim CEO
Mark Hurd - April 2005 to Aug 2010 - $12.2m severance
Cathie Lesjack - Aug 2010 to Sep 2010 - $1m cash bonus, 2.5m stock grants - Interim CEO
Leo Apotheker - Sep 2010 to Sep 2011 - $7.2m severance
Meg Whitman - Sep 2011 to Present
So I was exaggerating a bit, but lets look at this from a worst case scenario.
From 2005 to 2011 (6 years) HP had 6 CEO's, that's an average of a CEO a year (not really, because we're taking the end of one's career and the beginning of another, but like I said, worst case). Not including their regular "pay", they took home a total of $45.9m in severance pay, an average of $9.18m per CEO not including Meg, who has yet to receive a severance package (we're waiting..). Basically, that's 9.2m for each for being fired. Here's the crazy part. The Interim CEO's, who by all accounts did a fine job (looking mostly at Robert Wayman), got paid less than those who were "let go" (namely Mark Hurd and Leo Apotheker)
So things aren't quite as bad with the CEO's as I seem to have remembered, but I still feel like that's fairly abismal performance for a company that has been falling off a cliff since... well, since I can remember. Granted I'm young compared to some of you, but I can remember the days before Carly Fiorina, and a time I wouldn't go near HP computers because of how terrible I thought they were, for a variety of reasons that's pointless to debate here.
As for the English speaking, all you have to do is explain to them that you have a hearing problem and need to speak with someone who is accent free in English. They will bend over backwards to get you to a native English speaker (quasi Americans with disabilities act and all).
Now the downside to this is more time on hold. The upside- beside understanding what they are saying- is that the native English speaker will likely by a higher level tech who can go outside the chart without delving into "please insert the restore CD into the computer" or at least be able to warn about backups first. but there is no guarantee. Well, I guess now there is no restore CD, press key combination and select restore?
Being an Indian, I understand the frustration when support goes out to some dude in India who barely speaks English. I have been there myself, not only that, I have been asked how I made it to Canada.
Nonetheless, those that do make the H1B cut are not the same that answer those phone calls. H1B may be fresh grads, however most have engineering degrees, at the start of which they had to compete against 500,000 applicants for a under 10000 seats. Further, seats in Computer engineering which are valued more so than others are probably around 1000.
Furthermore, there is a contrast in fee, in US, a student might have to bail out if he cannot afford the education, so not only do you have to be smart, you have to be rich, contrasting that to peanuts, the competition gets very very tough back in India.
So joke all you want, those that do make it to US are rather smart and hard working.
I'm not saying they are not exploited, they are. The solution is simple, the employer has to prove, H1B is needed as local talent cannot be found, if thats the case, do not tie H1B to an employer, let the employee roam free. You will see a drastic cut in H1B and abuse of new immigrants.
I discovered the big problem in American business today: Executives can make big money by running a company aground. Enough money so that their grandchildren won't have to work.
Greenspan thought companies would self regulate. His mistake was subtle: He assumed that the leadership of the company needed the company to be healthy in order for the executives to prosper. But a new pattern emerged: executives could engage in behavior which could yield a multiple-lifetime supply of wealth by engaging in practices which ultimately destroyed the company.
And that's what happened to the financial sector in the US. And doubtless other companies which yield this particular prize.
I don't know what the common underlying reason is but this is the common symptom - being able to make the Big Score by running a company aground.
in the last few decades, there has been mass mind-reprogramming that seems to convince people that 'profit above all else, to the exclusion of all else' is what american companies are supposed to be about.
but go back to our grandfather's days and you would find social responsibility (which was hard fought for, during the union days). companies DID care and they DID shoulder the burden during hard times, because they saw value in the INVESTMENT in their work force! it was common for people to work at the same company for 20, 30 even 40 years!
find anyone like that today. I dare you. if you find someone working 20 yrs at the same place, its extremely rare.
this is now how it used to be. and don't accept that this was always how it was and how its meant to be. that's brainwashing by the new capitalists who are no better than white collar criminals, these days.
What has changed my friend is court cases of the 1980's defined the role of a company. The question is who owns the company? The shareholders and big banks won. It is not to make profit. It is to raise the shareprice. It must grow grow and grow and if it gets too high go do splits forever with no end in sight! If a CEO can't perform this then hire someone else who can. It is taught in finance 101 today in any college and was asked during my exam even.
So how does this change things?
1. You can't grow by creating great products when your share is saturated or is no longer a cash cow with competition
2. The emphasis on Engineers getting MBA's does not help the goal of the company. Cost accountants getting MBA's and bean counters making critical decisions and overiding IT and engineering make a better value for raising the share price
3. The only way to get a magical p/e ratio is to raise revenue and cut expenses by sitting on cash and going in debt rather than investing on growth
4. When you are out of ideas SELL or CUT DRASTIC CUTS to gain quarterly updates. When that doesn't work by other companies to get other investors raise the share price or sell it so the shareholders can sell out their high costs and give you the golden parachute for looking after shareholder intestests etc.
How many times did I write shareholder? See the problem? It is a math game today of flipping for computer programs that make entities more wealth.
That is the downside. The upside is newer agile competitors can rise up as HP is killing itself and Lenovo and Asus are taking its place. HP needs to hire more financial engineering majors to tinker with the price through accounting tricks and will cash out when it can't sell computers by selling it to Asus as a shadow of itself etc.
It is sad really but unregulated greed and Wall Street is ruining the whole country. Did you know bankers went to jail setting gold and stock prices! True ... today they do it with HFT supercomputers and do not blink. Why is this legal? But until courts role stakeholders not shareholders only you will continue to see shareholder activists like iKahn screwing things up and cashing in and funding Tea Party and anti union laws to make sure he can make even more money.
This corruption needs to stop
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