HEWLETT-PACKARD plans to cut 27,000 jobs in a bid to save up to $3.5 billion annually.

The cuts announced this evening represent HP’s largest in its 73-year history. The reductions will affect about 8 per cent of HP’s nearly 350,000 employees by the time the restructuring is completed in October 2014.

HP hopes to avoid as many lay-offs as possible by offering early retirement packages. The BBC reports that a spokesperson for HP said that it is too early to say where the 27,000 job cuts will be made.

HP CEO Meg Whitman said that the company plans to funnel most of the savings into developing more products and services that could help HP adapt to tech shifts that are driving demand for more mobile computing and software that is provided over high-speed Internet connections.

“While some of these actions are difficult because they involve the loss of jobs, they are necessary to improve execution and to fund the long term health of the company,” Whitman said in a statement.

As part of shake-up, Whitman is also bringing in a new leader for HP’s Autonomy division, which makes software for searching for information within companies and government agencies. Bill Veghte, HP’s chief strategy officer, is replacing Autonomy founder Mike Lynch in an effort to boost the division’s financial performance.

HP bought Autonomy for more than $10 billion last year before the company named Whitman as its CEO.

News of the cutbacks overshadowed the release of HP’s latest quarterly results. The company’s earnings and revenue were both better than analysts projected.

- Additional reporting by Susan Ryan