IBM confirmed on Tuesday that it will lay off a “low single-digit percentage” of its global workforce in the current quarter, marking the company’s latest restructuring move as it leans more heavily on artificial intelligence to boost productivity and streamline operations.
A spokesperson for the company told CNBC that while some U.S.-based roles will be affected, the overall headcount in the United States will remain flat year over year. IBM employed about 270,000 people globally as of the end of 2024, according to its annual report. A 1% reduction would translate to roughly 2,700 jobs lost, though the company did not disclose a precise figure.
The layoffs highlight how even established technology giants are adapting to a shifting business landscape driven by AI automation and productivity-focused cost restructuring. IBM has been progressively introducing AI systems into internal workflows, reducing the need for certain roles while reallocating resources toward growth segments such as cloud computing, software development, and AI-driven enterprise solutions.
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In May, CEO Arvind Krishna told The Wall Street Journal that IBM had already allowed AI agents to take over tasks previously handled by about 200 human resources employees, freeing the company to invest more in software engineering and sales talent. Krishna, who succeeded Ginni Rometty in 2020, has overseen a broad transformation strategy aimed at modernizing IBM’s legacy systems and pivoting toward AI and hybrid cloud services.
The company’s most recent quarterly results reflected that shift. In October, IBM reported better-than-expected earnings, with a 10% year-on-year rise in software revenue, largely driven by growing adoption of its Watsonx AI platform and demand from corporate clients seeking AI integration in business processes.
IBM is not alone in its workforce recalibration. Across the tech industry, companies are tightening headcount amid a global drive toward automation. Amazon announced in October that it would lay off 14,000 corporate employees, while Meta said its AI division would part with 600 workers as it redirects spending toward large-scale AI infrastructure. Similar cuts have also been reported at Google and Microsoft earlier in the year.
For IBM, however, the cuts appear to be targeted and strategic rather than sweeping. The company has maintained that these adjustments are part of an effort to rebalance its workforce — trimming slower-growth functions while bolstering areas tied to AI software, consulting, and cloud computing.
IBM also executed smaller layoffs earlier in March 2024, letting go of marketing and communications staff as part of a restructuring initiative. Executives said the ongoing changes were essential to position IBM as a leader in enterprise-grade AI services and to ensure long-term competitiveness in a rapidly evolving digital economy.
The move aligns with a broader trend among global corporations looking to maximize efficiency and profit through automation, as AI tools become increasingly capable of handling administrative, analytical, and creative tasks once managed by humans. For IBM, this transition is expected to boost profitability and operational agility, even though it also highlights a growing concern about the displacement of traditional roles as AI technologies continue to advance.
With AI now embedded in nearly every aspect of IBM’s operations, Krishna has framed the company’s direction as one of “AI augmentation rather than replacement.” However, the gradual reshaping of its workforce — from human resource functions to core service delivery — confirms the fears expressed by many that AI automation will lead to massive job displacement.