Dell plans to cut 6,650 jobs, equivalent to 5% of its workforce
Dell has announced that it will be laying off 5% of its employees, a total of 6,650 jobs, on Monday.
ROUND ROCK, TEXAS (TechtUSA) - A 5% reduction in workforce of Dell, equivalent to 6,650 jobs, has been described in a Securities and Exchange Commission 8-K filing dated January 6th. The cut is due to a challenging global economy and is part of a strategic realignment effort. Jeff Clarke, Vice Chairman and Co-COO of Dell, provided additional information in a message accompanying the filing.
According to Jeff Clarke, the previously implemented cost-cutting measures such as halting external hiring and limiting travel "are no longer enough" in light of the "uncertain future" and "downturn impacts". New measures will be taken to streamline Dell's Global Sales organization and control costs for the Infrastructure Group and Client Solutions Group.
"Unfortunately, with changes like this, some members of our team will be leaving the company," Clarke added.
According to Dell's recent 10-K filing, the company had around 133,000 employees as of January 28, 2022. With a 5% reduction in personnel, Dell's workforce will be reduced to its lowest level in 6 years, as reported by Bloomberg.
IDC recently reported a decline in PC shipments during the 2022 holiday quarter, down 28.1% compared to the previous year. The PC boom caused by the COVID-19 pandemic has ended for the PC market and the current global economic situation could decrease future PC demand. However, IDC predicts that parts of the PC market may experience growth in late 2023, with the overall market following in 2024.
IDC reported that in the fourth quarter of 2022, Dell was in third place for worldwide PC shipments with 16.1% market share, behind HP with 19.6% and Lenovo with 23%.
Dell's announcement of cutting 5% of its workforce follows similar announcements from other tech companies. Google recently announced a reduction of 12,000 employees, while Microsoft announced cutting 10,000 jobs. Microsoft was also impacted by the decline in PC shipments, as its fiscal Q1 results showed a 15% decrease in revenue from its Windows OEM business.
Apple CEO Tim Cook addresses possibility of layoffs as a 'last resort'Tech
