The price cuts aren't necessarily coming at HP's expense, either. The sources cited suggest HP has been shopping for vendors with more aggressive pricing, at the cost of their own margin, and placing larger orders with vendors who offer such. Some of HP's production partners are expected to take profit hits because of this. How this will affect HP's earnings isn't mentioned; I suspect HP is attempting to minimize any impact to their bottom line while avoiding the loss of more ground to Acer.
At the moment HP is still very strong. They are number one in the notebook market, and Dell has been slipping slowly. Product strength will be key as well in the coming year, as the mobile market has been growing faster than ever before -- so pricing won't be everything.