New cuts in IT: IBM and Lam Research plan to lay off 5,200 people

January 26, 2023  16:10

Mass layoffs in large companies of IT-sector continue. This time the U.S. corporations International Business Machines (IBM) and Lam Research announced they are planning to lay off a total of 5,200 people.

Although IBM CEO Arvind Krishna was cautiously optimistic about the company's prospects at a recent forum in Davos, there will still be job cuts. IBM plans to cut 3,900 employees (just over 1 percent of its workforce), and Lam Research plans to cut 1,300 employees (7 percent of its workforce).

IBM, based in New York State, didn't mention the cuts in its quarterly earnings report Wednesday or during a video call with analysts to discuss financial results.

According to Bloomberg, this is primarily about employees left behind after Kyndryl and Watson Health separated from IBM. The company confirmed this information in a conversation with AFP. "It is not an action based on 2022 performance or 2023 expectations," the company said.

IBM reported earnings of $2.9 billion in the last three months of last year, up about 17 percent from 2021.

Lam Research, a supplier of the equipment needed to make chips, said the cuts would occur in March of this year. Last December, the company laid off another 700 temporary workers.

According to consulting firm Challenger, Gray & Christmas Inc, last year's troubling trend of job cuts in the IT sector continues, and layoffs at IBM and Lam Research are part of that trend.

Large companies in the IT sector are announcing layoffs one after another. For example, Google announced layoffs of 12,000 employees. In addition, managers, whose salaries ranged from $500,000 to $1 million, were cut.

Microsoft announced a few days ago that it plans to cut up to 11,000 employees. Amazon plans to lay off more than 18,000 employees, and HP plans to cut 4000-6,000 employees over the next 3 years. There have also been layoffs at Meta, Oracle, Twitter, and several other companies. Twitter has laid off more than 2/3 of its employees.

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