IBM Layoffs 2023: From the beginning of 2023, all major companies have announced large-scale layoffs and it seems that this process will not stop now. Yes! We say this because now a new and big name has been added to this list – IBM.
In fact, global technology giant IBM Corp has now announced 3,900 layoffs. The company announced the massive layoffs while presenting its earnings report late Wednesday night Indian time.
As it turns out, IBM announced 3,900 layoffs as part of some asset divestments, citing the same reason that revenue fell far short of expectations in the fourth quarter.
IBM Chief Financial Officer James Kavanaugh admitted to missing revenue targets. Reuters The company is still client-facing and will continue to hire new employees in the research and development department.
IBM Retrenchment 2023
In its official statement, the company said the layoffs are related to the spinoff of its Kindle business and a portion of its AI-related unit, Watson Health. According to IBM, the company will incur a $300 million charge in the January-March quarter as a result of the layoffs.
Shares of the company registered a 2% decline following the news. According to experts, job cuts and missing estimates in revenue reports are the main reasons for this decline. According to reports, the company’s layoffs actually account for 1.5% of its total workforce.
If seen, in 2022, IBM recorded cash flow of around $9.3 billion, which was less than its $10 billion target.
In fact, the reason behind this is the possible slowdown in the market and the lack of efforts to digitize businesses, due to which businesses have now become very cautious in terms of spending.
IBM’s software and consulting businesses posted the slowest sequential growth rates in the fourth quarter, but its cloud business gave the company some hope.
Its hybrid cloud business grew its revenue by 2% in the quarter ended December. And according to Refinitiv, the company will report total revenue of about $16.69 billion in 2022, which was flat compared to analysts’ estimates of $16.40 billion.
Let us say that in the last year to 2022, IBM also registered a revenue growth of 5.5%, which is the highest growth recorded by the company in a decade so far.
In the first year of 2023, Amazon has announced layoffs of 18,000, Google about 12,000 and Microsoft more than 10,000.
Also this year Swiggy laid off more than 350 workers, Wipro laid off more than 450 workers. Earlier, Meta had laid off 11,000 and Salesforce more than 8,000.