HP to cut over 9000 jobs

The world's largest personal computer maker Hewlett-Packard Co. is planning on cutting 9,000 jobs in an attempt to remodel its business model to help it compete with IBM Corp.

HP will take a $1 billion charge for paying severance and modernizing its data centers to provide more automated services to customers. The California based company plans to replace about 6,000 eliminated positions in several different countries.

According to executive vice president for enterprise business, Ann Livermore “These sets of actions will enable HP to grow better than the market.”

The job cuts come after HP raised its 2010 forecast last month for the third time since November as results beat analysts’ estimates on a revival in business spending. According to HP the $1 billion in expenses for severance costs and asset impairments will be applied between now and fiscal 2013. The moves will result in net annual savings of $500 million to $700 million.

The company had 304,000 employees at the end of its fiscal year in October. Hurd, 53, has cut jobs before to shift the workforce and expand the sales staff. When he took over as CEO in 2005, he cut 10 percent, or more than 15,000 jobs, to lift profit. In 2008, he announced a plan to eliminate 24,600 positions over three years to save $1.8 billion after the purchase of EDS.