Dell to lay off 5% of its workforce

CNN
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Dell plans to lay off about 5% of its workforce, the company said in a regulatory filing Monday, in the latest example of tech companies cutting costs amid an uncertain economic climate.

In January 2022, Dell said it had 133,000 employees. At this level, the 5% cut would represent more than 6,500 employees.

The IT giant cited the “challenging global economic environment” for the cuts. In a letter to employees, Jeff Clarke, vice president of Dell, said the measures the company has already taken – such as restrictions on employee travel and a pause on external hiring – are insufficient.

“What we do know is that market conditions continue to erode with an uncertain future,” Clarke told employees. “The measures we have taken to stay ahead of the impacts of the recession – which have enabled several strong quarters in a row – are no longer enough. We now have to make additional decisions to prepare for the road ahead.

The move comes as layoffs continue to spread across the tech industry. Amazon, Microsoft, Google and others have each announced plans to cut thousands of workers as companies adjust to changing pandemic demand and fears of a looming recession.

Dell also struggled with reduced demand for personal computers.

Consulting firm Gartner said last month that global PC shipments fell more than 28% in the fourth quarter of 2022 compared to the same period a year earlier. It’s the biggest quarterly decline in shipments since Gartner began tracking the PC market in the mid-1990s.

Dell, in particular, saw a 37% decline in PC vendor unit shipments in the last three months of 2022 compared to a year earlier, according to Gartner.