January's grim job loss tally grows as IBM makes layoffs

Big Blue is reportedly cutting 3,900 jobs

IBM is the latest tech giant to turn to layoffs, confirming to CRN that the vendor plans to cut between 1 percent and 1.5 percent of its global workforce.

Multiple media reports put the number of laid off workers at 3,900: 1.5 per cent of a global workforce of 260,000.

The latest public employee disclosure from IBM showed about 282,000 workers at the end of 2021. Assuming the headcount is closer to that total, the layoffs would number between 2,820 people and 4,230 people.

The layoffs are related to the Kyndryl spinoff and healthcare divestiture and not based on 2022 performance or 2023 expectations, an IBM spokesperson told CRN in an email.

CRN has also reached out to Red Hat to see if the IBM subsidiary is part of the layoffs.

On IBM's Q4 earnings call on Wednesday, chief financial officer Jim Kavanaugh said he anticipates a $300m charge during the first quarter due to "remaining stranded costs" - which appears to be related to the layoffs, according to Reuters.

Kavanaugh told Reuters that Armonk, NY-based IBM will still hire in client-facing research and development roles.

IBM saw $16.7bn in revenue during the quarter, up six per cent ignoring foreign exchange, the company reported Wednesday.

IBM saw $60.5bn in revenue during the year, up 12 per cent year over year ignoring foreign exchange.

IBM's stock traded at $137.66 a share after hours, down 2.2 percent after market close.

The vendor is the latest tech giant to announce layoffs as heightened demand for digital tools during the pandemic gives way to more spending caution with inflation rising.

Others include Salesforce, Microsoft, Cisco, 8x8 and Sophos.