IBM And SAP Become The Latest Technological Companies To LAY Off Thousands Of Global Employees

IBM plans to cut thousands of workers. (photo: dock. IBM)

JAKARTA - Termination of employment (PHK) has again occurred to technology companies, this time IBM and SAP which plan to cut thousands of workers, following similar steps taken by Microsoft and Alphabet (Google) earlier this week.

IBM said it would cut about 3,900 workers, by 1.5 percent of its global workforce. layoffs will cost the company around USD 300 million, equivalent to IDR 4.4 trillion this quarter.

German software giant SAP also said it plans to lay off 2.5 percent of its 112,000 global workers, totaling around 2,800 workers.

An IBM spokesperson told CNN International on Friday, January 27, the layoffs were fully linked to the Kyndryl spin-off as well as the disposal of the health data and analysis business. This means that these layoffs are not a step based on 2022 performance or 2023 expectations.

Kyndryl is an IT infrastructure service business officially separated from IBM in November, while IBM's health care analytic business is currently in the process of being acquired by investment firms.

Back last year before IBM released the two businesses, the company said it would invest $20 billion in semiconductors, quantum computing, and other cutting-edge technologies in the state of New York.

"Clients in all geographic areas are increasingly using our hybrid cloud and AI solutions as technology remains a differentiating force in today's business environment," IBM Chair and CEO Arvind Krishna said in a statement.

"Looking at 2023, we expect full-year revenue growth to be consistent with our mid-single digit model."

Similarly, SAP CEO Christian Klein who gave the reason for the restructuring is targeted and the company will focus on investing in a very important field with the aim of becoming competitive in the future, particularly the cloud business.

The company said it would explore sales of its subsidiary Qualtrics, which specializes in online market research software. Further sales will allow SAP to focus more on its core cloud business.

With this layoff information, the two companies joined hundreds of other tech giants who recently chose to reduce their workforce due to market concerns.

Earlier this week, Microsoft announced it had cut 10,000 jobs while Google's parent company Alphabet announced it had also laid off about 12,000 employees worldwide.

Even Facebook's parent Meta also recently announced 11,000 layoffs, or 13 percent of its workforce in November last year.