Dell is set to cut about 5% of its global workforce, or about 6,000 jobs, amid a slump in PC demand and “uncertain” market conditions, according to a regulatory filing with the Securities and Exchange Commission.
In the filing, the company said that the cuts will “align its investments more closely with its previously discussed strategic and customer priorities” as the company “[takes] prudent steps in light of a challenging global economic environment.”
The move by Dell adds another name to the list of tech companies who are making cuts, including HP, Alphabet, Microsoft, Amazon, IBM and SAP, among others.
In a memo to employees, Vice Chairman and co-COO Jeff Clarke said that ongoing company efforts such as limiting travel, a pause on external hiring and Dell reducing its spending on outside services were “no longer enough” and that “market conditions continue to erode with an uncertain future.”
Clarke’s memo said that the “resets” would focus on restructuring of its sales teams, integrating services into its Infrastructure Solution Group and Client Solutions Group to “[align] accountability for the cost of services closer to the control points in engineering and product design” and that its ISG engineering would shift resources to its “priority offerings.”
Dell’s most recent results, for its fiscal third quarter, saw quarterly revenue down 6% at $24.7 billion, but net income was down 93% year-over-year for the quarter and down 63% for the preceding nine-month period. While its ISG group delivered record quarterly revenue, its CSG group (consisting largely of consumer and business hardware and peripheral sales) saw net revenues down 17%, with the consumer side particularly hard-hit.
Dell said that it expected the costs related to the layoffs to hit its books in its fiscal fourth quarter of this year.
