The International Business Machines (IBM) would cut about 3,900 jobs, as per Wall Street Journal (WSJ). The mass layoff, that is linked to Kyndryl Holdings, the IT services business that IBM spun off last year, and its healthcare divestiture, will incur about a USD 300 million charge, an IBM Corp spokesman told WSJ.
“Technology companies at large have been affected by a slowdown in spending as concerns about the economy and a potential recession linger, which has resulted in a wave of recent layoffs,” said The Wall Street Journal.
After Microsoft, The IBM Corporation also jumped on the bandwagon. Microsoft had announced plans to cut jobs on January 24 as it recorded a dip in its sales growth in more than six years in its latest quarter. In 2022, the hybrid cloud revenue of IBM Corp grew by 11%, to $22.4 billion. According to WSJ, IBM forecast adjusted revenue growth consistent with its mid-single digit model and about $10.5 billion in consolidated free cash flow for full-year 2023.
IBM corporation to cut 3,900 jobs in 2023
According to IBM’s latest annual report, the layoffs would amount to a 1.4% reduction from its headcount of 2,80,000. Meanwhile, the IBM corporation posted flat sales in the fourth quarter after the strong US dollar hurt its reported revenue by more than $1 billion, as per the WSJ. The company shared a net income of $2.71 billion, or $2.96 a share in the fourth quarter which ended on December 31 whereas last year it was $2.33 billion, or $2.57 a share, reported ANI.
“Adjusted earnings were USD 3.60 a share, slightly above analysts’ estimates of USD 3.59 a share,” reported ANI citing the WSJ report.Further, the WSJ added, “Software gained 2.8% to $7.3 billion; consulting added 0.5% to $4.8 billion; and infrastructure rose 1.6% to $4.5 billion.