Dell Technologies announce second round of layoffs, cuts 12,500 jobs to focus on AI

By Vinaykumar Patil | First Published Aug 8, 2024, 12:27 PM IST

Dell Technologies is cutting approximately 12,500 jobs, or 10% of its workforce, marking its second round of layoffs in 15 months. This move is part of Dell's strategy to focus on AI and modern IT solutions, streamline operations, and realign business priorities for future growth.

Dell Technologies has announced a significant reduction in its workforce, laying off approximately 12,500 employees. This marks the second round of layoffs within the past 15 months, representing about 10 per cent of the company's total workforce. The decision is part of Dell's broader strategy to focus on modern IT solutions and artificial intelligence (AI) while streamlining operations and realigning business priorities for future growth.

In a recent memo, Bill Scannell, President of Global Sales and Customer Operations, and John Byrne, President of Global Channels, communicated the decision to employees. They emphasized that these layoffs, though painful, are essential for enhancing the company's efficiency and positioning Dell to capitalize on emerging opportunities in AI and technology.

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The layoffs come as Dell seeks to restructure its operations to better align with market demands and accelerate growth. The company has been investing heavily in AI to drive innovation and unlock new value for consumer organizations.

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Affected employees will receive severance packages that include two months' pay plus an additional week per year of service, up to a maximum of 26 weeks. Despite these provisions, there is notable dissatisfaction among longtime staff, many of whom are concerned about losing incentives and stock options. Some employees had anticipated the cuts due to earlier budget reductions and cancelled projects.

In fiscal year 2023, Dell had already reduced its workforce by 13,000. With the latest round of layoffs, the company's headcount has decreased from 120,000 to 100,000.

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