Business Technology giant Hewlett Packard Enterprise is planning major cost cuts due to COVID-19 that has resulted in eroding sales. This is inclusive of layoffs that are estimated to save $1 billion to the company by 2022.
HPE announced the plan while declaring its earnings for the Q2 – FY 2020 that ended on April 30. Accordingly, it will provisionally slash the salaries of employees from 1 July to 31 October. The executives will be hardest hit by this move.
The company announced that the salary for the executives will be slashed by 20% to 25% depending on the job. It will also shut down an undisclosed number of offices for saving real estate expenses. This is as it transitions to a model of work-from-home after shelter-in-place orders were passed across the US.
The numbers of layoffs are yet to be determined according to an HPE Spokesperson. The company will work out the details in the months ahead. This is as it assesses diverse areas for driving savings, added the Spokesperson.
Meanwhile, Antonio Neri the HPE CEO said that it is not an easy thing for a CEO to inform the employees regarding cut in their salaries.
HPE sales dipped by 16% year-over-year in the Q2-2020 to $ 6 Billion. This was due to the supply chain disruption according to the company which said it was not able to quickly ship products as earlier.