Dell Technologies has announced a second round of layoffs in the past 15 months, letting go of around 12,500 employees, which amounts to about 10% of its workforce. This significant reduction is part of Dell’s strategy to refocus on Artificial Intelligence (AI) and modern IT solutions, aiming to streamline operations and prioritize investments in areas projected to drive future growth.
The layoffs are part of a broader reorganization intended to emphasize investments in AI and modern IT technologies. Dell plans to leverage AI to unlock new value for its customer organizations and stay ahead of market trends.
Bill Scannell, President of Global Sales and Customer Operations, and John Byrne, Global Channels President, communicated the decision through a memo. They underscored the need to “streamline layers of management” and indicated that these difficult steps were necessary for future growth. Employees learned about their layoffs through HR exit meetings, with some finding out during rescheduled one-on-one meetings.
Affected employees are reportedly being offered severance packages that include two months’ wages plus an additional week per year of service, up to a maximum of 26 weeks. However, there has been dissatisfaction among long-term employees regarding the loss of incentives and stock options. Some employees had anticipated the cuts due to recent budget reductions and canceled projects.
This latest round of layoffs follows a trend of workforce reductions at Dell, which previously cut around 13,000 employees in the 2023 fiscal year. The company’s decision to call employees back to the office, reversing a prior remote-work policy, was also seen as a move to reduce staff. With these recent layoffs, Dell’s workforce is expected to fall below 100,000, down from 120,000.
Previously, we reported on similar layoffs at another tech giant, Intel, which has been cutting jobs amid declining revenues.
