The HP Way: Shareholders get dividends, employees get pink slips
Company pays out $768 million in dividends over past three quarters, lays off up to 30,000
HP is expected to deliver some bad, bad news to shareholders when it announces fiscal 2012 second-quarter results after the market closes on Wednesday -- up to 30,000 HP employees (about 8% of the total global workforce) soon will lose their jobs as the company's revenues and future prospects continue to decline, with no perceptible end in sight.
It's a typical story in the business world. A new CEO (in this case, former eBay chief executive Meg Whitman) vows to turn around a struggling company with a new growth strategy, a laser-like focus on the company's core business, a renewed commitment to its customers, and a call to employees to remain optimistic, loyal and dedicated to the enterprise's success.
Then they announce layoffs.
But all of the news recently emanating from HP headquarters is not doom and gloom. Check out this announcement from May 17, less than a week before the big layoffs expected Wednesday:
The HP board of directors has declared a regular cash dividend of 13.2 cents per share on the company’s common stock.
Here's some more good news from March 26:
HP today announced that the HP board of directors has authorized a 10 percent increase in the amount of its regular quarterly dividend, to $0.132 per share.
And this from January 19:
The HP board of directors has declared a regular cash dividend of 12 cents per share on the company’s common stock.
Those three quarterly dividend awards amount to 38.4 cents per share. HP has 2 billion shares of common stock outstanding. By my math, HP is paying out $768 million in stock dividends so far this year. In case you're wondering, that would pay for nearly 10,000 jobs at an average salary of $80,000 (less including benefits, but still).
So while HP shareholders are getting dividend checks in the mail, thousands of HP workers will be getting severance checks and one-sided employment termination agreements drawn up by HP lawyers.
Sounds about right.