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Sources told Bloomberg that IBM is planning to cut thousands of jobs in Europe as it restructures its business.
Tech giant IBM is reportedly planning to cut about 10,000 jobs in Europe in order to lower costs, according to Bloomberg.
Sources told the publication that roles in the company’s managed infrastructure IT services business are most at risk from the cuts.
The news comes after last month’s announcement of a major restructuring for IBM, which includes plans to spin out its IT infrastructure business in order to focus more on AI and cloud.
The job cuts are expected to be completed by mid-2021 and the UK and Germany are said to be the most impacted, though job cuts are also reportedly planned for Poland, Slovakia, Italy and Belgium.
A spokesperson for IBM told Siliconrepublic.com that the company is making “significant investments in education and skills development” for staff to better meet clients’ needs.
“Our workforce decisions are made to best support our clients on their journey to adopting an open hybrid cloud platform and AI capability, and we are reinvesting in our business.”
Spinning out
As part of IBM’s restructuring plan, the company said its managed infrastructure services unit would become a new public company, provisionally called NewCo, by the end of 2021.
At the time of the announcement, IBM chief executive Arvind Krishna said it was “the right time” to create two separate companies that could focus on their own strengths.
“IBM will focus on its open hybrid cloud platform and AI capabilities. NewCo will have greater agility to design, run and modernise the infrastructure of the world’s most important organisations. Both companies will be on an improved growth trajectory with greater ability to partner and capture new opportunities – creating value for clients and shareholders,” he said.
At the end of October, just a few weeks after the restructuring announcement, IBM reported a decline in its earnings with total revenue falling 2.6pc in Q3 2020. However, business was buoyed by a strong performance in the company’s cloud division, which saw revenue over the previous 12 months reach $24.4bn, up 22pc.
