News

IBM Reorg: Up To 13,000 Job Cuts, Mostly in EU

IBM announced late Wednesday a restructuring that will result in layoffs of as many as 13,000 workers, primarily in Europe, and a pre-tax charge of up to $1.7 billion.

The main goal of the reorganization is “to improve the company's efficiencies, strengthen its client-facing operations and capture opportunities in high-growth markets,” according to a corporate statement.

Largely due to slowness in European markets, IBM plans to move employees into more direct client relationship roles and eliminate what it refers to as the “traditional pan-European management layer” that, to this point, has been necessary for coordinating activities across countries’ borders.

“As a result, IBM will create a number of smaller, more flexible local operating units in Europe to increase direct client contact,” according to the company’s statement. “On a worldwide basis, IBM plans to improve the efficiency of its services operations by consolidating much of the service delivery workload into fewer locations by using standard job roles, processes and tools.”

The result for workers will be the elimination of 10,000 to 13,000 jobs, while for shareholders, it will add up to a pre-tax charge during the second quarter of between $1.3 billion and $1.7 billion. Bottom line benefits to the company should begin to accrue during the second half, the company says.

Further details of the restructuring are due to be revealed Thursday morning in a conference call with senior vice president and CFO Mark Loughridge.

About the Author

Stuart J. Johnston has covered technology, especially Microsoft, since February 1988 for InfoWorld, Computerworld, Information Week, and PC World, as well as for Enterprise Developer, XML & Web Services, and .NET magazines.

Featured

  • Microsoft Appoints Althoff as New CEO for Commercial Business

    Microsoft CEO and chairman Satya Nadella on Wednesday announced the promotion of Judson Althoff to CEO of the company's commercial business, presenting the move as a response to the dramatic industrywide shifts caused by AI.

  • Broadcom Revamps VMware Partner Program Again

    Broadcom recently announced a significant update regarding its VMware Cloud Service Provider (VCSP) program, coinciding with the release of VMware Cloud Foundation (VCF) 9.0, a key component in Broadcom’s private cloud strategy.

  • Closeup of the new Copilot keyboard key

    Microsoft Updates Copilot To Add Context-Sensitive Agents to Teams, SharePoint

    Microsoft has rolled out a new public preview for collaborative "always on" agents in Microsoft 365 Copilot, bringing enhanced, context-aware tools into Teams channels, meetings, SharePoint sites, Planner workstreams and Viva Engage communities.

  • Windows 365 Cloud Apps Now Available for Public Preview

    Microsoft announced this week that Windows 365 Cloud Apps are now available for public preview. This aims to allow IT administrators to stream individual Windows applications from the cloud, removing the need to assign Cloud PCs to every user.