Reuters HP CEO Meg Whitman
As HP cleaves itself in two, the company will also trim another 5,000 employees from its payroll.
And even that won't be the end of a massive multiyear layoff that grows bigger every few months, HP CEO Meg Whitman essentially told CNBC's Dan Farber on Monday.
HP first announced its layoffs plans in 2012. Back then, HP said it would cut 27,000. By June of this year, it had doubled the target, to 50,000, with 36,000 employees already gone.
On Monday, it bumped up the new layoff target, yet again, to 55,000. Even so, HP remains an enormous employer, with over 330,000 employees worldwide, and that means that when HP reorganizes itself, it will likely make even more cuts.
This is what Whitman said about it on CNBC's "Squawk on the Street."
Whitman: I think for 2015 in terms of this restructuring, we are done. Now when you split companies apart, typically, and we have looked at all of the other ones that have been done, often there is again realignment of the workforce, but we'll see how it goes.
Faber: Well, it sounds to me, from that answer, that conceivably there are going to be more job cuts to come for these two companies.
Whitman: We have to organize ourselves for these companies to win in the market. Now, the truth is, we're a lot more efficient than we were, you know, three years ago, as you can see. But we have to set these companies up to win, that is our mission.
This news must be frustrating for HP employees, but it can't be a surprise. HP has been in a near-constant state of restructuring since 2008 when it bought EDS for $13.9 billion (then-CEO Mark Hurd's signature deal), which doubled its workforce to about 400,000. Since then, HP has been regularly cutting people, and has spent more than $8 billion on restructuring charges.
That EDS unit, now called HP Enterprise Services, has been HP's biggest problem child for years, too, arguably in worse shape than the PC business ever was.
And it looks like HP ES may be in for more scrutiny as part of the new Hewlett-Packard Enterprise company. In her CNBC interview, Whitman specifically named the Enterprise Services group as the reason why HP won't show revenue growth in fiscal 2015, keeping her from making good on her promise to have HP growing again by 2015 ( year four of her five-year plan to turn HP around).
"We said that 2015 we'd be flat in constant currency. Without Enterprise Services, the company would actually grow," she told Farber.
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