The corporate landscape in the United States is entering a new phase in which artificial intelligence serves not only as a catalyst for innovation but as a justification for sweeping structural change. HP’s newly announced restructuring program illustrates this transition with unusual clarity. A company long associated with the stability of the PC and printing markets is now preparing to reengineer its operating core, aiming to save $1 billion annually by 2028. At YourDailyAnalysis, we emphasize that “HP’s shift into the AI era is not a cosmetic upgrade – it is an attempt to redesign the company from the process level up.”
The financial contours of the plan are explicit: HP expects roughly $650 million in restructuring costs, with about $250 million hitting its 2026 fiscal year. This shift comes with deep workforce reductions across operational, support and internal development teams – precisely those areas most exposed to automation through AI. The investor presentation outlines three strategic pillars: enhancing customer experience, accelerating product innovation and boosting productivity through AI-driven process redesign, platform simplification and program consolidation.
CEO Enrique Lores noted that HP began running AI pilots two years ago and quickly realized that meaningful gains require rebuilding workflows before integrating generative systems into them. At YourDailyAnalysis, we interpret this as a move away from incremental automation and toward a fundamental rearchitecture of HP’s internal machinery – a change that naturally reduces the need for layers of human coordination.
Financial results reinforce the picture of a company in transition. HP surpassed revenue expectations in the fourth quarter and, according to Lores, finished 2025 with improving profitability between the first and second halves of the year. Yet its 2026 diluted non-GAAP EPS forecast of $2.90 to $3.20 fell short of the $3.32 analysts expected, suggesting that the short-term costs of restructuring and component inflation will outweigh the near-term benefits of AI efficiencies. The market reacted swiftly: shares fell more than 5% in after-hours trading and remain down over 25% year-to-date.
The broader labor context is equally significant. The wave of AI-driven white-collar layoffs – already visible across Amazon, Workday and other major firms – is reshaping office-heavy corporate structures. HP’s announcement confirms the trajectory: automation is moving from factory floors into administrative, engineering and service layers that once felt insulated. As we frame it in YourDailyAnalysis, “AI has become both a technological tool and a managerial rationale for rethinking cost structures at their foundations.”
Paradoxically, HP sees AI not only as a cost lever but as a growth engine. Lores stated that HP aims to outperform the broader market in 2026, driven by the expansion of AI PCs and the integration of AI across product lines. Demand for these devices is growing, and the market appears poised for a renewal cycle – though one that will require substantial investment in memory, compute and supporting software.
Taking a step back, Your Daily Analysis sees HP at a moment where pressure and possibility meet. The company must tighten its cost structure or risk further margin erosion, yet it also possesses a real chance to remake itself into a leaner, more adaptive player built around AI-native processes and products. The outcome will hinge on three variables: whether HP can sustain strong AI PC sales amid rising competition, how effectively it executes workforce reductions without damaging core capabilities, and how quickly margins recover after restructuring.
If HP navigates this transition with discipline, it could emerge by the decade’s end as a more compact but more resilient competitor. If it stumbles, the AI transformation risks becoming another expensive experiment in corporate reinvention – one that reshuffles headcount without meaningfully enhancing long-term value for shareholders.
