IBM’s IT group will cut some 3,900 jobs, or just over 1% of its workforce, as part of a layoff plan linked to its strategic refocusing, a source familiar with the matter said on Wednesday.
Armonk’s company did not expressly mention these job cuts either in its earnings press release, published Wednesday, or during the conference call to present its quarterly accounts. The leaders only mentioned an exceptional collection of 300 million dollars, which corresponds, according to the source, to the cost of the social plan.
An exceptional collection of 300 million dollars
In 2021, IBM split its information systems consulting and maintenance activities from the rest of the group, one of the company’s historical branches but less thriving than remote (cloud) computing, in which it has invested massively.
The new entity born from this spin-off was called Kyndryl and went public in November 2021. As for the activity related to the collection and analysis of data in the medical field, which was part of the Watson Health division, it was sold at the beginning of from 2022 to the investment company Francisco Partners.
If the positions affected by the social plan had remained within IBM after these two separations, these are functions related to these two activities, according to the source. IBM on Wednesday posted fourth-quarter revenue slightly above expectations and net profit in line with analysts’ forecasts.
During the earnings conference call, Chief Financial Officer James Kavanaugh said it was “cautious” to expect growth at the lower end of the group’s usual range. In electronic trading after the Wall Street close, the IBM stock lost just under 2%.
Source: BFM TV
