When CEO Dion Weisler announced in February that HP (NYSE:HPQ) planned to cut approximately 3,000 jobs before the end of its 2016 fiscal year, little was made of it. Shortly after its split from the now HP Enterprise in Nov. 2015, a leaner and more cost-conscious HP was expected.

But news that another 3,000 to 4,000 HP staffers would be let go over the next three years didn't sit as well with investors. HP stock has slid 6% since announcing the cuts on Oct. 14. When that info is coupled with -- what some pundits consider -- poor fiscal 2017 guidance, some may think HP is not worth a look.

Image source: HP.

Some perspective

It won't be pleasant for the employees affected by this year's job cuts or the 3,000 to 4,000 over the next several years. However, it's worth noting that HP's global workforce numbered approximately 51,000 after its split with HP Enterprise.

Reducing an estimated 12% to 14% of HP's workforce over the course of four years simply doesn't warrant a "sky is falling" sell-off. That's particularly true in HP's case in that a primary objective in splitting with HP Enterprise was to manage spending, manufacturing, and sales efforts in a more focused manner.

HP's "disappointing" guidance for fiscal 2017 of non-GAAP (excluding one-time items) per-share earnings of $1.55 to $1.65 and free cash flow of $2.3 billion to $2.6 billion are also worth a closer look. The consensus earnings-per-share (EPS) estimates for the coming fiscal year are for $1.61.

Even in the mid-range, HP will hit expectations, which is hardly "disappointing." CEO Dion Weisler's free cash flow (FCF) expectations for the coming year were also "mildly disappointing."

HP is comfortable enough with the billions it will generate in FCF that it will return between 50% to 75% to shareholders in the form of dividends and share buyback initiatives -- which HP's board has given the OK to increase by $3 billion, along with a 7% bump in dividend yield, to 3.5%.

The plan is coming together

Last quarter, it became apparent that HP's expense-management efforts and go-to-market strategy are working. Yes, HP sales were down 4%, to $11.9 billion, but its total costs and expenses dropped to $10.76 billion, down 5% compared to a year ago. And Weisler is just getting started.

As for PC sales, after accounting for currency, HP grew revenue 2% last quarter thanks to a 4% jump in total unit sales. Despite a 4.5% drop in total PC shipments in the second calendar quarter, HP enjoyed a whopping 5.1% improvement. HP's strong results left it close to replacing Lenovo (OTC:LNVGY) as the leading PC manufacturer in the world, as it already is domestically. During the same quarter, Lenovo suffered a 2.3% decline, leaving it with a slim 0.4% PC market lead over HP.

One reason HP is performing surprisingly well is by targeting specific, niche markets within the PC industry. HP's new-ish OMEN laptop, designed with the world's gamers, comes fully equipped with high-end graphics and virtual reality (VR) capabilities. And HP is implementing the same strategy to boost its lagging printer results.

Among the many benefits of HP's $1.05 billion deal to acquire Samsung's printing unit is its cutting-edge multifunction printing technology (MFP). Combined with HP's PageWide printing solution, the deal with Samsung gives it a technological leg up on its competition. HP is also moving full steam ahead on its 3D printing ambitions, which are expected to become a $30 billion industry in five years.

There are a couple of other benefits to HP's acquisition of Samsung's printing unit. Along with more than 6,500 patents, HP will gain nearly 1,300 printing researchers and engineers to continue its "disruption" plans for the $55 billion print industry. All those engineers won't replace those affected by the job cuts, but they fit HP's strategy of targeting niche markets with evolving technology.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.