Hewlett-Packard Co., the world's largest maker of personal computers, plans to cut about 24,600 jobs over three years as part of its integration of Electronic Data Systems Corp.
The cuts amount to about 7.5 percent of the workforce, Hewlett-Packard said Monday. The company also expects to incur $1.7 billion in expenses this quarter for the cuts. Hewlett-Packard and EDS have a combined 320,000 employees.
Hewlett-Packard paid $13.2 billion for EDS to more than double revenue from services, such as managing computer networks and data centers for corporate customers. Combined, the companies' service units had more than $38 billion in sales last year. The acquisition catapulted Hewlett-Packard to second in that market behind IBM.
Half the job cuts will be in the United States, Palo Alto, Calif.-based Hewlett-Packard said. The company also is looking at saving money on real estate, procurement and information technology spending. Hewlett-Packard last month completed its acquisition of EDS, which was founded in 1962 by H. Ross Perot. Bloomberg News
Wreckage from the massive crisis on Wall Street could prompt the Federal Reserve to do an about-face and once again cut a key interest rate this week or possibly later this year, economists said Monday.
Just a few days ago, a rate cut appeared largely off the table. Now it has emerged as a possibility as the Fed prepares to meet today against a backdrop of historic upheaval in the U.S. financial system.
Lehman Brothers Holdings Inc., the country's fourth-largest investment firm, filed for bankruptcy protection Monday. Also, Bank of America is buying Merrill Lynch in a $50 billion deal.
“It puts a Fed rate cut back on the table,” said Stuart Hoffman, chief economist at PNC Financial Services Group. Associated Press
The last two major independent U.S. securities firms, Goldman Sachs Group Inc. and Morgan Stanley, probably will report declining profit this week when they update investors amid a collapse of Wall Street rivals.
The average estimate of 19 analysts surveyed by Bloomberg shows that Goldman, the largest and most profitable U.S. securities firm, is expected to say today that third-quarter net income fell 73 percent, the most in its nine-year history as a public firm, putting the investment bank on track for its biggest annual earnings drop. Morgan Stanley, the second-largest, is expected to show a 44 percent profit decline.
The reports might also provide an insight into whether a future exists for independent securities firms after the third- and fourth-largest were driven to extinction over the weekend. Bloomberg News
United Airlines, the No. 2 U.S. carrier, is doubling the fee for checking a second bag on domestic flights to $50 each way, blaming higher jet-fuel costs.
The increase applies to tickets bought starting today for travel Nov. 10 or later, the airline said Monday. First- and business-class customers and United's frequent fliers don't have to pay the new charge. The Chicago-based carrier, a unit of UAL Corp., said one in seven passengers will be affected by the higher fee.
United's increase extends steps taken by U.S. carriers to counter fuel prices that have climbed 45 percent in the past year and made it the industry's largest expense. United said its added changes, including the bag fees, will produce $700million in revenue next year. Bloomberg News