IBM Layoffs: Tech Firm To Sack Employees In Marketing And Communications Team, Says Report

IBM's fourth-quarter revenue saw a modest 4 per cent increase compared to the previous year, surpassing earnings estimates

IBM has reportedly informed its marketing and communications division employees on Tuesday about an impending workforce reduction in the coming days. Jonathan Adashek, IBM's chief communications officer, conveyed the decision during a brief meeting lasting approximately seven minutes with employees in the affected unit, according to a report by CNBC citing the sources.

In December, IBM’s chief executive officer Arvind Krishna informed CNBC that the company was extensively training all its employees in Artificial Intelligence (AI), following the announcement made in August to replace nearly 8,000 jobs with AI. In its earnings call in January of the following year, IBM disclosed plans to cut 3,900 positions.

“In 4Q earnings earlier this year, IBM disclosed a workforce rebalancing charge that would represent a very low single-digit percentage of IBM’s global workforce, and we expect to exit 2024 at roughly the same level of employment as we entered with,” IBM said in a statement, as per the report.

The recent layoffs coincide with a broader trend of downsizing within the tech sector. In the current year, approximately 204 tech companies have collectively slashed nearly 50,000 jobs, as reported by Layoffs.fyi, a layoff tracking website. January witnessed heightened activity in layoffs, with Alphabet, Amazon, and Unity announcing workforce reductions.

Despite IBM's return to growth in recent years, expansion efforts have been subdued. Fourth-quarter revenue saw a modest 4 per cent increase compared to the previous year, surpassing earnings estimates. During the earnings call, chief financial officer James Kavanaugh addressed the need for workforce rebalancing.

IBM has been endeavouring to integrate itself into the evolving AI landscape. In May, IBM unveiled WatsonX, described as a development hub for organisations to "train, refine, and implement" machine learning models. During IBM's earnings call in January, it was revealed that the revenue generated from generative AI and WatsonX products had doubled compared to the third quarter of 2023.