Just because you know something is going to happen -- particularly something bad -- it can still have a negative impact. A case in point is the loss of 27,000 jobs at HP out of its estimated 350,000 workforce.
We all knew that this was coming with indications that something was on the cards much earlier in the year. But even still, 27,000 is a big number, even for a big company -- in this case, about 8% -- indicating that some major restructuring is going on inside, even if it's not clear what the purpose of that restructuring is.
From an investor point of view, this will save about US$ 3 billion per year, which will be nice given the financials that HP has just reported for the end of Q2, but what actually happens product-wise might not be so good.
Completing the image of a ship with no destination, HP has also announced that Mike Lynch, which HP acquired along with his company Autonomy for a controversial US$ 10 billion last year, is also leaving the company, despite saying a number of months ago that he wanted to stay.
What’s interesting about this is that in the announcement of the job cuts, Meg Whitman said that the money saved would be spent in growth areas like cloud storage, an area in which Autonomy already excels.
Autonomy Without Lynch
Whether Autonomy manages to keep going in HP without Lynch is the question du jour at the moment, with many pointing out the number of companies that HP has swallowed whole over the years, without even spitting out the pips.
There is also the fact that the rumor mill in the UK is suggesting that Lynch is already looking at developing a bigger and better Autonomy -- although clearly not called that -- with the big stash of cash he was paid by HP for his company, estimated to be in the region of US$ 800 million.
Add to the mix the fact that according to recent reports in ComputerWorld UK, close to 20% of the management team of Autonomy has left since it was taken over by HP.