Key Takeaways
- IBM will cut thousands of jobs in Q4 2025, affecting a “low single-digit percentage” of its global workforce
- The layoffs target strategic realignment toward AI, software, and cloud services
- Despite job cuts, IBM expects overall US employment to remain stable as it hires in growth areas
IBM has announced plans to lay off thousands of employees worldwide in the fourth quarter of 2025 as the company intensifies its focus on artificial intelligence, software, and cloud services. This strategic move comes amid a broader wave of tech industry layoffs as companies streamline operations and pivot toward digital growth opportunities.
Scale and Impact of Workforce Reduction
The job cuts follow stronger-than-expected quarterly earnings where IBM witnessed a 10% rise in software revenue. An IBM spokesperson confirmed to CNBC that the reduction would affect a “low single-digit percentage” of its global workforce.
With approximately 270,000 employees at the end of 2024, even a 1% cut would translate to roughly 2,700 positions. The company emphasized it regularly reviews staffing needs and adjusts roles to support strategic priorities.
While some US-based roles will be affected, IBM expects overall US employment to remain broadly flat throughout the year as it simultaneously hires in growth-focused areas. This suggests targeted restructuring rather than widespread elimination of positions.
Strategic Transformation Under CEO Leadership
Under CEO Arvind Krishna’s leadership since 2020, IBM has been steadily transforming away from legacy businesses toward high-value segments. The company has significantly invested in generative AI, hybrid cloud, and software-led services, considering these areas central to its long-term strategy.
Krishna has previously highlighted AI’s internal impact, noting that AI tools have already assumed tasks equivalent to approximately 200 human-resources employees, allowing IBM to redirect resources toward hiring more software engineers and sales talent.
Broader Tech Industry Context
IBM’s workforce reduction reflects a wider trend across Silicon Valley and the global technology sector. Amazon recently announced plans to cut around 14,000 corporate positions, while Meta and Microsoft have also implemented workforce reductions in 2025.
According to tracker Layoffs.fyi, more than 112,700 tech workers have been laid off across over 218 companies so far this year as organizations adopt AI to enhance productivity, streamline costs, and accelerate product development.
Financial Performance and Future Outlook
Despite IBM’s share price climbing more than 35% in 2025, the company has reported slowing cloud-software growth. The technology giant continues to rely heavily on its software and services divisions to support earnings and maintain investor confidence.
The latest workforce adjustments appear part of a comprehensive effort to reallocate resources, streamline operations, and strengthen investments in areas expected to drive future performance.
