IBM Is Laying Off Thousands of Employees as Its AI Business Surges
IBM reportedly notified several thousand employees that they were being laid off this week.
Key Takeaways
- IBM stated earlier this week that it will conduct layoffs in the current quarter.
- The cuts will impact 鈥渁 low single-digit percentage鈥 of IBM鈥檚 270,000-person global workforce.
- IBM is making cuts as it focuses on high-growth areas such as AI consulting and software.
IBM disclosed on Tuesday that it will eliminate a small percentage of its workforce in the current fourth quarter. The action will affect “a low single-digit percentage” of IBM’s global workforce, the company told .
According to , IBM began notifying several thousand global employees this week about layoffs, issuing notifications that give staff 30 days to secure another position within the company or face termination with a few months of severance pay. The Register reports that most of those notified are unlikely to find new positions and will be required to exit IBM.
IBM employed about 270,000 people at the end of 2024, per its latest , so even a 1% cut would impact 2,700 employees. An IBM spokesperson that the layoffs “may impact some U.S.-based roles” but that the company anticipates keeping its U.S. headcount “flat year over year” overall. So although some U.S. roles may be impacted, IBM’s overall U.S. employment figures are expected to remain stable.
IBM is making the cuts as it shifts its attention to high-growth businesses in AI consulting and software. According to , IBM’s chief financial officer, Jim Kavanaugh, stated in a conference call with analysts last month that more corporations were beginning to adopt AI, evidenced by the fact that about 80% of IBM’s AI consulting and software clients in the past six months were new to the company.
In the third quarter, IBM’s bookings for AI consulting and software surged to $9.5 billion, a $2 billion increase from the second quarter, per .
“Our AI book of business now stands at more than $9.5 billion,” IBM CEO Arvind Krishna said in , emphasizing the “strength” of IBM’s AI business.
Other tech companies have also conducted layoffs recently. Amazon announced last month that it was eliminating 14,000 corporate roles, one of the in the company’s corporate history. Meanwhile, software giant Oracle of employees in Washington state this week as part of a restructuring plan.
Last month, IBM $16.3 billion in revenue for the third quarter of 2025, marking a 9% increase compared to the same period the previous year. The company also posted profits of $1.7 billion for the quarter, up from a the previous year.
At the time of writing, IBM has in the U.S., ranging from roles such as senior software developer to business development executive.
Key Takeaways
- IBM stated earlier this week that it will conduct layoffs in the current quarter.
- The cuts will impact 鈥渁 low single-digit percentage鈥 of IBM鈥檚 270,000-person global workforce.
- IBM is making cuts as it focuses on high-growth areas such as AI consulting and software.
IBM disclosed on Tuesday that it will eliminate a small percentage of its workforce in the current fourth quarter. The action will affect “a low single-digit percentage” of IBM’s global workforce, the company told .
According to , IBM began notifying several thousand global employees this week about layoffs, issuing notifications that give staff 30 days to secure another position within the company or face termination with a few months of severance pay. The Register reports that most of those notified are unlikely to find new positions and will be required to exit IBM.
IBM employed about 270,000 people at the end of 2024, per its latest , so even a 1% cut would impact 2,700 employees. An IBM spokesperson that the layoffs “may impact some U.S.-based roles” but that the company anticipates keeping its U.S. headcount “flat year over year” overall. So although some U.S. roles may be impacted, IBM’s overall U.S. employment figures are expected to remain stable.
