Last updated: January 26, 2023, 12:20 PM IST
IBM cuts 3,900 jobs, misses annual cash target
According to James Kavanaugh, IBM’s chief financial officer, the layoffs in the January-March period will cost the company $300 million.
Tech giant IBM is laying off 3,900 employees, following the spin-off of IT infrastructure service provider Kyndryl Business and part of the AI unit called ‘Watson Health’.
According to James Kavanaugh, IBM’s chief financial officer, the layoffs in the January-March period will cost the company $300 million.
“We’ve taken some significant portfolio actions over the past few years, which has led to some stranded costs in our business,” he said during the company’s earnings call late Wednesday.
“We expect to address these remaining stranded costs early in the year and expect a charge of approximately $300 million in the first quarter,” Kavanaugh added.
IBM joins a slew of technology companies such as Meta, Alphabet, Microsoft and others in laying off thousands of employees amid the global economic headwind.
In the quarter ended December 31, 2022, the company earned $16.7 billion in revenue, $3.8 billion in pre-tax operating income and operating earnings per share of $3.60.
“In our seasonally strongest quarter, we generated $5.2 billion in free cash flow,” the company said.
Sales for the quarter were more than 6 percent higher at constant exchange rates.
Arvind Krishna, Chairman and Chief Executive Officer of IBM, said that to strengthen the software portfolio, “we have invested in hybrid cloud and AI capabilities”.
“This year we will unlock more productivity, expand our strategic partnerships and invest more in specific growth markets. For 2023, we see revenue growth in line with our mid-single-digit model range and approximately $10.5 billion in free cash flow,” said Krishna.
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(This story has not been edited by News18 staff and was published from a syndicated news agency feed)
