With 3,900 roles, or 1.5 percent of its global staff, scheduled to be cut, IBM layoffs have become the most recent tech layoffs of 2023.
The corporation disclosed the IBM layoffs on Wednesday, claiming they were connected to the separation and sale of two business units that had already been disclosed. A spokeswoman for IBM said the change will cost the company roughly $300 million this quarter.
The units in question are IBM’s healthcare analytics business, which an investment firm is in the process of acquiring, and Kyndryl, an IT infrastructure services company that was formally separated from IBM in November.
The announcement coincides with other significant tech corporations cutting jobs globally in reaction to the bleak prognosis for the world economy. Microsoft (MSFT) and Google parent Alphabet each announced the layoffs of 10,000 and 12,000 employees, respectively, last week.
That came after similar proposals to eliminate thousands of jobs were made public by Salesforce and Amazon (AMZN), with the e-commerce giant alone affecting more than 18,000 workers.
Why IBM layoffs are happening?
A representative for IBM told CNN on Wednesday that the IBM layoffs were only linked to the restructuring of the two affected business segments and “not an action based on 2022 performance or 2023 expectations”. The New York-based business also released mixed financial results on Wednesday, with slightly higher sales than anticipated offset by lower operating profit and free cash flow. In nighttime trading after hours, IBM shares fell 2%.
When asked about the prospects for the need for business technology this year, Arvind Krishna, CEO of IBM, stated that the majority of the clients of the company appeared sure they would “emerge stronger.”
What is IBM known for?
Now that we’ve finished talking about IBM layoffs, let us tell you a little bit about IBM for our unfamiliar readers.
IBM is known for its computer hardware and software, as well as its consulting and IT services. Some of the company’s most famous products and technologies include the IBM PC, the IBM mainframe, and the IBM Watson artificial intelligence platform. IBM has also been involved in a number of important technological innovations throughout its history, including the development of the UPC barcode, the creation of the relational database, and the development of the first chess-playing computer to defeat a human world champion.
What does IBM mean?
IBM stands for International Business Machines. The company was originally founded in 1911 as the Computing-Tabulating-Recording Company (CTR) and was renamed to International Business Machines (IBM) in 1924. The company has been known as IBM ever since. IBM is a multinational technology and consulting corporation that provides a wide range of products and services, including computer hardware and software, IT services, and business consulting.
Why are tech layoffs of 2023 happening?
Tech layoffs of 2023 are happening for a variety of reasons. Some common reasons for tech layoffs 2023 include:
Restructuring: Companies may lay off employees as part of a restructuring effort to cut costs, streamline operations, or shift their focus to new areas of business
Mergers and acquisitions: When two companies merge or one company acquires another, there may overlap in certain areas of the business, leading to layoffs
Economic downturns: During economic downturns, companies may lay off employees as a way to cut costs and weather the downturn
Automation and Artificial Intelligence: Advancements in technology are making some jobs redundant and companies may resort to layoffs to cut down on labor costs
A shift in business focus: Companies may also lay off employees if they are shifting their focus to new areas of business or new technologies, such as cloud computing or big data analytics
It’s important to note that companies may also lay off employees for other reasons, depending on the specific circumstances. When we look at IBM layoffs, we can say that it happened in order to provide sufficient financial support to the two subsidiaries of the company. Here we end our IBM layoffs story. We hope you weren’t affected by this layoff. Check out our news to learn about the biggest tech layoffs of 2022.