Dell is also reacting to the weak demand for PCs with layoffs. As Bloomberg reports, citing an internal memo, around 6,650 jobs are to be lost, which corresponds to around 5 percent of the global workforce.
Dell's Co-Chief Operating Officer said about this measure Jeff Clarke via a memo that Bloomberg says it has. The letter said Dell is experiencing market conditions that “continue to erode with an uncertain future.” Previous measures such as hiring freezes or cuts in business trips are no longer sufficient.
Therefore, numerous employees now have to leave the company leave and some departments will be reorganized. A graphic shows that after the layoffs, around 126,300 of the previously around 133,000 employees remain. This would be the lowest level in six years.
After the PC boom came the fall
Above all, the weakened PC business is causing problems for Dell, which is responsible for just over half of sales. According to studies by IDC, PC sales in the fourth quarter of 2022 fell by 37 percent compared to 2021. However, the years 2020 and 2021 were also “fat” years in the segment, as the global COVID-19 pandemic led to more home working and a great need for new PCs for the home office. The boom is now followed by a fall to the normal level before this era.
Dell is by no means the only manufacturer in the industry to react to the changed economic situation in this way. As a direct competitor, HP had already announced job cuts in November. And Cisco also wanted to lay off about 5 percent of the workforce. At the end of January, IBM followed suit and announced that it would lay off 3,900 employees.
PC market could stabilize
The market researchers at IDC are looking to the coming years with confidence. According to the forecast from December, PC sales should remain at an almost constant level until 2026.
The tablet market remains difficult but also largely stable (Image: IDC)