IBM to cut 1.5% of global workforce

IBM currently employs about 3,000 employees in Ireland

IBM offices in Dublin.

IBM has announced layoffs as part of some asset divestments after missing its annual cash target, dampening cheer around beating revenue expectations in the fourth quarter.

The company announced today that it would be cutting 1.5% of its workforce.

Chief Financial Officer James Kavanaugh said that the company was still "committed to hiring for client-facing research and development".

The company will lay off 3,900 employees altogether following shares of the company falling 2% in extended trading, erasing earlier gains on the largely upbeat results. 

IBM employs more than 3,000 people in Ireland. It forecasts annual revenue growth in the mid-single digits on constant currency terms, weaker than the 12% it reported last year, as pandemic-led demand for digitizing businesses has given way to cautious spending by clients amid rising recession fears.

In October, IBM flagged softness in new bookings in Western Europe while peer Accenture noted weakness in its consulting business. Cognizant Technology Solutions Corp in November cut its 2022 forecast due to a pullback in contracts.

IBM's software and consulting business growth slowed down sequentially in the fourth quarter, but cloud spending was a bright spot, with deal signings doubling in 2022 for setting up services with partners such as Amazon.com's and Microsoft's Azure.

Its hybrid cloud revenue rose 2% in the quarter ended December 31st. Total revenue was flat at $16.69bn in the period, compared with analysts' estimates of $16.40bn.

For 2022, IBM recorded revenue growth of 5.5%, its highest in a decade.

Reuters