Hewlett Packard Enterprises lays out $1 billion savings plan, pay cuts

Hewlett Packard Enterprise (HPE.N) on Thursday unveiled a plan targeting gross savings of at least $1 billion (817.6 million pounds) by 2022 and cut the base salaries of top executives by 25% as the software maker seeks to weather the coronavirus crisis.

Shares, down about 35% this year, fell 5.4% in extended trading after the company missed second-quarter revenue and profit estimates.

“The global economic lockdowns since February significantly impacted our fiscal Q2 financial performance,” Chief Executive Officer Antonio Neri said in a statement.

Beginning on July 1, through the remainder of fiscal year 2020, the base salaries of the CEO and officers at the executive vice president level will be reduced by 25%, HPE said.

The board also cut by 25% the portion of the annual $100,000 cash retainer entitled by directors for the period beginning on July 1 through the remainder of fiscal 2020.

HP, which in April withdrew its 2020 forecast, posted second-quarter adjusted earnings of 22 cents per share, missing the average analyst estimates of 29 cents, according to IBES data from Refinitiv.

Revenue of $6.01 billion also missed estimate of $6.29 billion.

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