Recently, IBM announced that it will lay off thousands of employees to focus more on the fast-growing software and artificial intelligence (AI) services. This move marks an important strategic restructuring of the 114-year-old technology giant, reflecting new trends in the tech industry.

According to IBM, this layoff will affect a "single-digit percentage" of its global workforce of about 270,000 employees, meaning the number of affected employees could be between 2,700 and 5,000. An IBM spokesperson said: "We regularly review our workforce and make adjustments as needed." This round of layoffs is expected to mainly affect the infrastructure department in the United States. Employees notified of a "resource action" will have 30 days to find internal new positions, otherwise they will face termination and corresponding severance pay.

IBM

This layoff is part of a strategic transformation led by IBM CEO Arvind Krishna, aiming to shift company resources toward higher-margin software and cloud services, including the acquired Red Hat division. Although IBM reported a 10% increase in software revenue in its recent financial report, analysts point out that the slowing growth of the Red Hat business may have prompted this restructuring.

IBM is actively investing in higher-growth areas, including software development, sales, and its generative AI platform watsonx. Meanwhile, internal reports indicate that the infrastructure department will suffer significant cuts, with some predicting a near-50% reduction in the U.S. infrastructure team. This trend is not unique to IBM, as other tech giants are also laying off staff to adapt to the new situation. For example, Amazon plans to cut 14,000 corporate jobs. IBM previously used AI agents to automate hundreds of human resources employees' work, shifting towards more technically and sales-oriented roles.

After releasing a better-than-expected financial report, IBM's decision to lay off employees highlights the industry trend of becoming more streamlined and focusing on profitable AI and cloud computing areas.

Key Points:

🌐 IBM's layoff plan will affect 2,700 to 5,000 employees, mainly in the infrastructure department.   

📈 The company's strategic transformation focuses on software and AI services, investing in higher-profit areas.   

🤖 The entire tech industry is experiencing a wave of layoffs, with IBM and other major companies adjusting their business directions to adapt to market changes.