EDS Acquisition Saves H-P Quarterly Results; But Profit Still Drops Sharply, Sparks More Layoffs

May 19, 2009
Without EDS, H-P financial quaterly results would have been dismal

Without EDS, H-P financial quaterly results would have been dismal

[Update] H-P said it will trim 2 percent of its 321,000 employees this year or 6,400 jobs, in addition to the already announced cuts associated with the EDS acquisition. Most the firing will happen outside the U.S. confirmed the Palo Alto, Calif.-company.

The recession is hitting H-P right at its core.

The Palo Alto, Calif.-company saw a revenue and profit decline in all of its businesses – aside of the Services division (more on that later) – including, PCs, servers, printers, software and financial services.

Even H-P’s golden egg, its Imaging and Printing Group (IPG), recorded a double digit decline in revenue (-23%), to $5.9 billion, from the same period a year ago.

On the other hand, H-P’s Services division recorded a whopping 99% increase in revenue to $8.5 billion, and an amazing 130% surge in profits, to $1.2 billion!

But the comparison is obviously flawed as H-P closed the EDS acquisition only last August and did not include EDS financial results until then.

Although H-P’s short-term outlook is still sombre, with revenue flat to down 2% sequentially, the world’s largest IT company still sees only a modest revenue drop for the year, at about 4% to 5%.

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Posted by TechPulse 360

No Big Layoff Planned At Cisco, But $1 Billion In Savings Is

February 5, 2009

Cisco Systems said the global recession is forcing it to refocus resources on the top market opportunities its sees in a troubled economic landscape.

Cisco added 65 new Telepresence customers in the second quarter and now has 312

Cisco added 65 new Telepresence customers in the second quarter and now has 312

“I don’t lack for growth opportunities,” said CEO John Chambers on a conference call discussing second quarter results. But customer spending is under pressure and saving money is necessary when sales fall, the company said. (In Cisco’s second quarter revenue was down 7.5 percent.)

The company plans to cut $1 billion in expenses during its 2009 fiscal year ended in July. That will mean some job cuts as employees shift from one assignment to the next.

Chambers said maybe 1,500 to 2,000 positions will go over the course of the year out of a workforce of 66,000.

But an across-the-board layoff of 10 percent of Cisco’s staff is not in the cards, unless business conditions take a dramatic turn for the worse.

“We are not going to consider a layoff at this point in time,” said Chambers. “We may be able to avoid a large downsizing event.”

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Posted by Mark Boslet

Employers: 4 Creative Alternatives To Avoid Layoffs

December 10, 2008
jason-zickerman

Communication with employees is key to keep company's morale and build loyalty recommends executive management expert Jason Zickerman.

These are unprecedented times for a lot of people in the workforce. Most of the younger employees never experienced such deep and massive layoffs that are now being reported live on Twitter.

Communicating with employees is key to make layoffs less painful

Although layoffs are needed to align the cost structure with current business conditions, a lot can be done to avoid them in the first place. “It all start with communicating with the employees. They must see that the employer is trying everything it can to keep them. You are building loyalty and you’ll get more from the employees,” advises Jason Zickerman, an executive management and operations expert and the president of The Alternative Board.

Here a 4 some creative ways Zickerman suggests to reduce payroll costs while avoiding straight layoffs:

  1. Move a portion of the staff from a 5 to a 4-days work-week. People fill their time with work they have. Companies will drive productivity up and get more out of the 4 days;
  2. Encourage “non-paid” vacations or time off, extend end year-end breaks;
  3. Allow employees to take sabbaticals to learn new skills, get educated but at a reduced pay;
  4. ‘Swap’ employees with other companies or non-profit organisations. I remember Cisco has done such a thing to retain key employees despite its last massive layoff in 2001.

But if layoffs are inevitable to save the company, the best way to manage it is to act as a human being, adds Zickerman. “Because you had this constant communication with employees, they know what’s happening, what you are doing for them. Also, it’s as much important to tell the ones that stay their importance for the company’s success. And keep the best ones, no matter if they cost more and more or less senior. This is a street fight,” says Zickerman.

The management expert also recommends to remove the bottom 20% performers every year if possible. “That’s a philosophy that Jack Welch, the former CEO of GE did and he became famous for that.” A discipline that could save your company one day.

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Posted by TechPulse 360

Cisco Will Do A One Time Massive Layoff If Downturn Persists; Agressively Looking For Startups To Acquire

December 4, 2008
Cisco CEO John Chambers is a strong advocate of telepresence to cut travel costs and improve efficiency

Cisco CEO John Chambers is a strong advocate of telepresence to cut travel costs and improve efficiency

In a meeting with Wall Street analysts earlier this week, Cisco CEO, John Chambers, said that job cuts are not planned at this point but that if they eventually happen “we’ll do it one time, not multiple small steps.”

This is an “instant replay” of the last downturn

Just like 7 years ago during the previous downturn, where Cisco laid off 8,500 employees – 18% of its workforce – and announced a staggering $2.2 billion inventory write-off, Chambers wants to make this one-time-cut deep and clean. The Cisco chief also said that it will encourage redundant employees to move to adjacent business units to keep their job inside the company.

Chambers pointed out that Cisco has reduced by half its travel expenses this year through the use of telepresence, social tools and online video.

Cisco wants to “aggressively” acquire more startups

Despite the gloom, Cisco plans to be an aggressive acquirer of smaller technology companies of 100 engineers or so. “Cash is king,” Chambers said. “And everything is for sale!”

Chambers also said that he’s spending more time bonding with Fortune 500 CEOs, to position Cisco for the upturn when they are ready to spend money, and not to desperately sell them network equipment now; although I’m sure there’s a lot of arm twisting too!

6 Comments | communications, news | Tagged: , , | Permalink
Posted by TechPulse 360

AMD Lays Off Another 500; Lowers Break Even Point To $1.5 Billion Per Quarter

November 5, 2008

The Sunnyvale, Calif., company said today that it’s cutting an additional 500 jobs or 3% of its global workforce.

This is AMD’s second major round of layoffs this year. In April, the world’s No. 2 maker of computer microprocessors cut 10 percent of its workforce worldwide or 1,600 jobs.

With the latest restructuring, AMD hopes to lower its break even point to $1.5 billion per quarter. Last quarter, the chip company reported a net loss of $67 million on sales of $1.78 billion.

Is AMD ready to announce its first profits?

1 Comment | chips, news | Tagged: , | Permalink
Posted by TechPulse 360

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