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As the market continues to shrink for traditional PC and server makers, onetime IT market leader Hewlett-Packard who recently underwent a major restructure in Australia, has announced plans to sack 29,000 of its workforce – up from a previously announced estimate of 27,000.

Hewlett-Packard is grappling with slower demand for printers, services and datacentre equipment, as well as PCs. It has so far failed to produce a compelling tablet device, as the likes of Apple and Samsung run away with that market – in the enterprise as well as among consumers.

The 29,000 job cuts will take place through fiscal year 2014, H-P said – and they come with a cost. The company will book reorganisation expenses of about US$3.7 billion during the period.

H-P will mainly wield the axe in its ailing enterprise services group, which manages datacentres and provides IT consulting services. It plans to write down the value of that business by about $8 billion.

“It’s more than they said last time, but who’s to say it’s not going to get higher if things get worse?,” said Brian White, an analyst at Topeka Capital Markets. “They’ve got a lot of wood to chop, and this is a long-term turnaround story.”

Overall, H-P hopes to generate annual savings of as much as US$3.5 billion, starting in 2014.

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