IBM cuts jobs as new CEO seeks revival
ARMONK, N.Y. — IBM told the Wall Street Journal it is laying off an undisclosed number of workers across the United States.
IBM representatives did not return calls and emails Friday to confirm the job cuts, which were also reported by Bloomberg.
The alreadystruggling tech giant’s new CEO, Arvind Krishna, warned investors last month of uncertainty caused by the COVID19 pandemic, saying the company made a “tough decision” to withdraw revenue projections for the rest of 2020. The company reported a 3.4% revenue decline in the JanuaryMarch quarter compared with the same period last year, blaming it in part on how the coronavirus outbreak was affecting sales.
The Journal said IBM’s job cuts could number in the thousands, citing an unnamed person familiar with the company’s plans. IBM had about 352,600 employees worldwide as of Dec. 31, according to its annual report. Krishna said in April that more than 95% of them are working remotely.
It is the latest example of the pandemic hitting the tech industry, even as demand rises for online services and computing power to help homebound people work, learn and entertain themselves online. Hewlett Packard Enterprise of San Jose announced planned cutbacks Thursday that are expected to cost jobs and reduce salaries.
These would be IBM’s first big layoffs under Krishna, who replaced Ginni Rometty as CEO on April 6. Rometty remains IBM’s executive chairwoman through the end of the year.
During his first quarterly earnings call as CEO last month, Krishna said the company will continue to eliminate software and services that don’t align with IBM’s top two focus areas for growth: cloud computing and artificial intelligence.
Once a household name for its personal computers, IBM shed its PC business in 2005 and has since become focused on supplying software services to big businesses, governments and other organizations. It worked to strengthen its cloud computing business under Rometty, but has struggled to compete with top cloud rivals Amazon, Microsoft and Google.
Krishna spoke optimistically early in May about how the 110yearold company could weather the pandemic.
“The fact that IBM has been here before gives me perspective and confidence,” Krishna said at the Think conference for IBM clients and developers, held remotely this year. “I believe history will look back on this as the moment when the digital transformation of business and society suddenly accelerated.”