IBM to cut 13,000 jobs
International Business Machines Corporation has reported that they would be cutting back workforce by almost 10,000 to 13,000. This would result in a pretax charge between USD 1.3 billion and USD 1.7 billion in the second quarter. Most of the job cuts are planned to take place in the European market where the company has been cutting back workforces since quite sometime.
The company reported disappointing first-quarter earnings last month and had laid off 500 workers in Sweden. They have also almost closed off their operations in five other European cities. Market Analysts say that the job cuts are on expected lines looking at the company’s performance in the last couple of years.
IBM reported a surprisingly disappointing earning result last month when they missed on the market estimates by around 5 cents a share. The company is now planning a sizable restructuring of their European operations. Goldman Sachs Group Inc. analyst Laura Conigliaro had reported last month: “European sales seemed particularly disrupted as rumors flared in the final weeks of the quarter.â€
The company plans to create a number of smaller, more flexible local operating units in Europe to increase direct client contact leading to a more efficient network of channels. The company is experiencing lack of growth in countries like France, Germany, Italy, and Japan.
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May 5th, 2005 at 5:19 pm
Hopefully this move does not affect the IBM software guys working here . this is also the high time for the people to realize that this stagnant gaint mainframe has to go in near future…this is particularly true for non computer science guys who want to get into software industry and end up in mainframes only..