IBM denies a rumor that it’s laying off 26 percent of its workforce. The company is hitting back at rumors that it’s planning the biggest layoff ever, with 110,000 employees in danger of their jobs. IBM has quashed the reports and said it only plans to lay off “several thousand” people. This still isn’t good news for employees.
IBM made an announcement in an email to Reuters.
“IBM does not comment on rumours, even ridiculous or baseless ones. If anyone had checked information readily available from our public earnings statements, or had simply asked us, they would know that IBM has already announced the company has just taken a $600-million charge for workforce rebalancing. This equates to several thousand people, a small fraction of what’s been reported.”
The news about the IBM layoff was first reported by Forbes journalist Robert X Cringely, according to Fast Company. The layoffs come under a massive company reorganization planned by Project Chrome. Cringely also reported that IBM would focus on its U.S.-based mainframe and storage divisions.
Investors are also looking to IBM to make some big changes, according to Morningstar stock analyst Peter Wahlstrom. These rumors have popped up, but have been “snuffed out pretty quickly,” Wahlstrom said, since there’s no evidence to them.
IBM has flatly denied the Forbes report. IBM spokesperson Ian Colley has also denied the rumor via telephone. IBM previously announced layoffs that would affect a “small fraction” of their employees, as last predicted by the journalist on Forbes.com, IBM said in their recent statement.
Such a huge layoff of IBM’s workforce would still be “off the charts,” according to Daniel Morgan, senior portfolio manager of Synovus Trust Company. Synovus currently holds about 300,000 of IBM’s shares, according to STL Today. Morgan elaborated about the layoff rumors plaguing IBM.
“I can’t see that. But I wouldn’t be surprised if we did hear of some more layoffs. They do let people go. I think that’s why this is gaining some traction.”
According to a report on the Inquisitr, IBM has struggled in the past years to shift from computer and hardware manufacturing to modern technologies such as cloud storage. IBM wants to keep up with Apple and Google when it comes to modern technology. IBM has also suffered a huge sales slump, as it announced another disappointing earnings report last week, as both revenue and profits fell in the December quarter.
IBM may deny the rumors of a potential layoff, but it wouldn’t be a complete surprise. The company’s largest round of layoff took place in 1993 when Big Blue released 60,000 people, which is a record when it comes to corporate redundancies.
[Image by Carlos Correa Loyola]