More tech job market misery as Dell lays off 5% of worldwide workforce
Tech workers took another big hit today when Dell announced it was laying off 5% of its worldwide employees in the face of plunging PC sales and general economic uncertainty. That's 6,650 people who will be out of work.
Bloomberg data showed that the company peaked at 165,000 employees in January 2020 and has been cutting headcount since. Before today’s announcement, it had dropped to 133,000 and is expected to hit 126,350 after today’s cuts.
Employees were informed in an email from Dell co-CEO and vice chairman Jeff Clarke with the usual platitudes that accompany these missives. Clarke said the move was an unfortunate outcome of the current economic climate.
“Unfortunately, with changes like this, some members of our team will be leaving the company. There is no tougher decision, but one we had to make for our long-term health and success. Please know we’ll support those impacted as they transition to their next opportunities,” he wrote.
He closed with, “The opportunities ahead of us are immense. The amount of data continues to explode. Our innovation is powering progress across the globe. And our customers are turning to us as their trusted partner. I’ve never been more confident in our future and our team.” That’s probably of little solace to the folks who are getting layoff notices today.
The company is coming off a quarter in which revenue dropped 6%, to $25 billion.
As we reported last month, PC sales plunged for the fourth straight quarter with Dell taking the biggest percentage loss, -37%, of any of the largest PC manufacturers, according to IDC, Canalys and Gartner data. But Dell is more than its PC business. It also has a robust enterprise business.
Dell made headlines when it bought EMC in 2015 for $67 billion (later valued at $58 billion), the largest tech deal in history at the time. The deal generated quite a bit of debt for the company, which the company is still trying to pay off. VMware was included in that acquisition, and the company spun it out last year before Broadcom offered to buy the company for $61 billion last May. That purchase is still tied up in regulatory approval.
Still, it's hard not to see such large numbers being thrown around and contrasting that with laying off workers to cut costs. This news comes after more than 80,000 workers lost their jobs at other big tech companies last month, and unfortunately we may not be done yet.
