Please ensure Javascript is enabled for purposes of website accessibility

IBM's New CEO Plans Layoffs

By Donna Fuscaldo – May 22, 2020 at 12:41PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

IBM hasn't said how many job cuts are coming, but reports point to several thousand.

International Business Machines (IBM 0.19%) is gearing up to lay off workers amid the COVID-19 pandemic, the first such action by CEO Arvind Krishna, who took on the role in April. 

IBM hasn't said how many employees it's letting go, but a source told The Wall Street Journal the move could eliminate several thousand jobs. The idea is to better align the tech stock with the current demand and to ensure it is agile in meeting the needs of new and existing customers. In a statement to the WSJ, IBM said its business requires it to easily remix the skills needed on a constant basis. IBM ended 2020 with 352,600 workers.  

A layoff sign due to COVID-19 with money in the background.


IBM workers who have already been let go told Bloomberg most of the layoffs are happening in the North American region and could include workers in North Carolina, Pennsylvania, California, Missouri, and New York. IBM's headquarters is in Armonk, New York.  

IBM joins a growing list of tech companies that have been forced to engage in layoffs amid the pandemic. Uber Technologies and Lyft, the two ride-hailing companies, have initiated layoffs, as has Hewlett Packard Enterprise

While IBM, like other companies, is suffering during the pandemic, it already faced problems before the disease hit. Its IT services, hardware, and legacy software have all experienced a slowdown in recent months. It's trying to carve out a leadership position in cloud, security, and analytics. The spotty results over recent years have resulted in Krishna taking over the CEO role. He was previously senior VP of IBM's cloud and cognitive software businesses, and he's also credited with pushing for the $34 billion Red Hat acquisition IBM made in the fall of 2018. The layoffs are one of his first actions as the new leader of the technology icon. 

Donna Fuscaldo has no position in any of the stocks mentioned. The Motley Fool recommends Uber Technologies. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

IBM Stock Quote
$125.74 (0.19%) $0.24
Uber Technologies Stock Quote
Uber Technologies
$29.18 (-0.03%) $0.01
Hewlett Packard Enterprise Co Stock Quote
Hewlett Packard Enterprise Co
$12.95 (0.78%) $0.10
Lyft Stock Quote
$13.75 (-0.36%) $0.05

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/05/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.