IBM is set to lay off numerous employees globally in the last quarter of 2025, as part of its strategic shift towards emphasizing artificial intelligence, software, and cloud services. This move aligns with a broader trend in the tech industry, where major players are restructuring operations to capitalize on new digital growth prospects.
Following robust quarterly earnings marked by a 10% increase in software revenue, IBM disclosed plans to reduce its workforce by a “low single-digit percentage.” With approximately 270,000 employees worldwide as of the end of 2024, a 1% reduction would translate to around 2,700 job cuts. The company clarified that such staffing adjustments are routine to support its strategic objectives.
While some positions in the US might be impacted, IBM anticipates maintaining overall employment levels in the country throughout the year by hiring in growth-related areas. This signals targeted workforce reductions aimed at reshaping roles rather than mass layoffs.
Under the leadership of CEO Arvind Krishna, who assumed the role in 2020, IBM has been steadily transforming its business away from traditional segments towards high-value domains like generative AI, hybrid cloud, and software-centric services. The company views these areas as critical to its long-term strategy. Notably, AI tools have automated tasks equivalent to the workload of about 200 human-resources employees, enabling IBM to onboard more software engineers and sales professionals.
The workforce restructuring at IBM mirrors a broader industry trend seen in Silicon Valley and globally, where companies like Amazon, Meta, and Microsoft have announced layoffs in 2025 to leverage AI for enhanced productivity, cost efficiency, and faster product development. Despite a notable rise in its share price this year, IBM has reported a slowdown in cloud-software growth but remains reliant on its software and services segments to sustain earnings and investor confidence. The recent job cuts are part of a larger initiative to reallocate resources, streamline operations, and bolster investments in areas expected to drive future performance.