HP’s Ink Business Used to Print Money. Now It’s Running Dry
HP’s printer and ink business used to gush money. Those days may be over.
The company announced a major restructuring at its 2019 securities analyst meeting on Thursday. HP will reduce its workforce of 55,000 by 7,000 to 9,000—a cut of 13% to 16%. The move is supposed to save $1 billion a year by the end of 2022. To entice investors, HP mentioned a 10% boost in stock dividends and increased share buybacks.
The news sent shares reeling by 9.6% at Friday’s market close. Morgan Stanley, Credit Suisse, and Bank of America all lowered their share price targets by a dollar or more. Loop Capital downgraded it from “buy” to “hold,” which is on top of September downgrades by Sanford C. Bernstein and USB.
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