On November 5, IBM announced it will implement a workforce reduction during the fourth quarter of 2025, impacting a low single-digit percentage of its global employees. A spokesperson told CNBC, "While some U.S. roles may be impacted, we anticipate that overall U.S. employment will remain flat year-over-year."

According to IBM's 2024 annual report, the company employed 270,000 people at year-end. Even a minimal 1% reduction would translate into roughly 2,700 job cuts globally. The company emphasized that the move aligns with ongoing efforts to streamline operations and redeploy talent toward higher-value functions, particularly in AI software, cloud computing, and enterprise hardware development.

CEO Arvind Krishna has led IBM's expansion into software and cloud services since 2020, with a focus on integrating AI technologies across operations. Earlier this year, AI systems took over tasks previously handled by around 200 human resources employees, freeing staff to focus on strategic roles in sales, software engineering, and hardware projects, Krishna told The Wall Street Journal in May.

The layoffs coincide with continued growth in IBM's AI-driven hardware and cloud segments. On October 22, IBM reported third-quarter results exceeding expectations, driven by a 10% increase in software revenue and solid performance in AI and cloud infrastructure offerings. While shares dipped nearly 2% following the workforce reduction announcement, analysts noted that the company's strategic redeployment could strengthen long-term capabilities in AI chips and enterprise computing solutions.

IBM's workforce adjustments mirror a broader trend in the tech sector. In October, Amazon announced cuts of 14,000 corporate roles, while Meta's AI division reduced 600 positions. Other firms, including YouTube and Ubisoft, have similarly implemented voluntary or incentive-driven layoffs to optimize efficiency through automation.

The company has previously reduced some marketing and communications positions in March 2024, demonstrating a consistent approach to workforce optimization. Analysts highlight that IBM's ability to balance headcount reductions with AI-driven redeployment in both software and hardware will be critical for maintaining its competitive edge in AI accelerators, enterprise cloud platforms, and emerging AI chip solutions.