HP/COMPAQ: Job cuts under way

While the 'new' Hewlett-Packard has begun notifying staff outside of the US of job cuts as part of the integration with Compaq, HP Australia is unsure when the local layoffs will start.

Details of the workforce reduction program, its timing and associated changes in countries around the world will be provided at a briefing on June 4 2002.

A spokesperson for HP Australia, who was unaware of the scheduled briefing, said HP Australia is unsure when the notice of employment termination letters will be sent to Australian employees or from which areas or departments job losses are most likely.

"It is not clear at this time. It hasn't started here yet and we are not sure when it will happen. It will flow through business unit by business unit. Each country will move forward at its own pace as there are many steps in the integration [of Compaq and HP]".

The spokesperson declined to speculate on how many jobs may be cut locally, saying they have been given no firm figures.

Meanwhile, according to HP chair and CEO, Carly Fiorina, HP has posted revenue for its second quarter of 2002 in the Asia-Pacific region which is 13 per cent lower than the second quarter a year ago.

The revenue announcement, the last before HP includes revenue from newly acquired Compaq in its results, indicated sharp revenue declines in the Asia-Pacific region's biggest markets, Japan and China.

The Australian spokesperson said the revenue results were due to a difficult time in the market last year, which affected all IT companies.

"All IT companies have been hit by that. We are not particularly any different," she said.

As to how HP expects the results to look this time next year when Compaq is included, the spokesperson said revenue will be positive.

"There has been a slow turn-around in the market. Both HP and Compaq are established in our own areas and the combination will prove strong locally," she said.

While acknowledging the many challenges facing the company, Fiorina said at a conference last week that the new HP had made an encouraging start.

"We have a lot to prove and we're realistic about the hard work ahead, but we're also proud and excited about our clean sprint out of the gate," she said.

* David Legard contributed to this article.

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