Hewlett Packard (HP) is cutting up to 3000 management jobs after warning that it expects sales to fall for the three months to the end of April and remain flat until August at least.
The company blamed a "rapid deterioration in consumer IT spending around the world" for the cuts, and said it expected revenues to fall between two and four per cent both sequentially and year-on-year for its second fiscal quarter ending 30 April 2001.
Carly Fiorina, chief executive at HP, said the slowdown had been worse than expected in the US and had spread to Europe.
"When we issued our previous second fiscal quarter guidance, we had limited visibility into the extent of the US consumer and commercial downturn, its potential impact on other regions and the continuation of adverse currency effects. At this time, it is quite clear that the US downturn in the consumer market is now spreading to other regions, notably Europe," she said.
"Recent European PC market data suggests the European slowdown is beginning to mirror the pattern we saw in the US - growing softness in the retail sector and increasingly competitive pricing moves followed by a more subtle but just as meaningful slowdown in the enterprise space," she added.
Fiorina explained that the company would cut costs through better housekeeping on expense management, tighter control of discretionary spending, requiring employees to take incremental days off, and the elimination of up to 3000 management positions.
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