Hewlett-Packard to slash 27,000 jobs

Hewlett-Packard announced on Wednesday that is cutting 27,000 jobs in a widely expected tactic aimed at reducing the struggling technology giant. HP expects the layoffs, which amount to 8 percent of its worldwide workforce, to save $3 billion to $3.5 billion by the end of 2014. According to HP, the majority of those savings will be reinvested in research and development. As investors applauded the company’s reform efforts and positive outlook, HP’s shares jumped by almost 11 percent in after-hours trading.

In a statement, HP CEO Meg Whitman said the changes “will further streamline our operations, improve our processes, and remove complexity from our business. While some of these actions are difficult because they involve the loss of jobs, they are necessary to improve execution and to fund the long term health of the company.” In a conference call with investors on Wednesday, Whitman said she remains “cautiously optimistic” about the future of HP. The tech giant is recovering from a chaotic 2011, in which incumbent CEO Leo Apotheker sought to shed the company’s PC business, continually reduced financial estimates, and was subsequently fired. HP said it expects the layoffs to “yield significant improvements in efficiency and customer service” over the next several years.