Dell Technologies Inc., one of the world’s leading personal computer manufacturers, is laying off 6,650 workers, or about 5% of its global workforce, due to the decline in PC sales and infrastructure requirements.[0] This comes as the wider tech industry faces a reduced demand for PCs due to the challenging economic environment.[1]
In a memo to employees, Jeff Clarke, co-Chief Operating Officer of Dell, declared that the company is currently being impacted by market conditions that “continue to erode with an uncertain future.”[2] He added: “Unfortunately, with changes like this, some members of our team will be leaving the company. There is no tougher decision, but one we had to make for our long-term health and success. Please know we’ll support those impacted as they transition to their next opportunities.”[3]
According to industry analyst IDC, Dell saw the most significant personal computer shipments decline of 37% year-on-year in 4Q22, generating 55% of its revenue from PCs.[4] Following a pandemic-era PC boom, Dell’s share price has dropped 28% over the past 12 months.
Dell reported having 133,000 employees as of January 2022.[5] A 5% reduction would equate to the loss of more than 6,500 workers at that level.[6]
Dell said it is taking steps to reorganize its sales, customer-support, product-development and engineering teams, while Clarke wrote that steps the company had already implemented, like limiting travel, pausing external hiring and reducing outside services spending, were insufficient.[7]
In a statement, Dell said department reorganizations and job cuts are an opportunity to drive efficiency and that it will support those impacted as they transition to their next opportunity.[7] Clarke added that the company will “prevail as we always do, for our customers, partners and each other. We’ll be more competitive, more focused and find a new level of operational performance. We will be ready when the market rebounds.”
Shares of Dell were down 3% early Monday and are down 31% over the last 12 months.
0. “Dell Cuts 6,600 Jobs as PC Sales Drop” Gizmodo, 6 Feb. 2023, https://gizmodo.com/dell-pcs-computers-tech-layoffs-texas-1850077094
1. “Dell To Cut About 6,600 Jobs, Battered By Plunging PC Sales” NDTV Profit, 6 Feb. 2023, https://www.ndtv.com/business/dell-to-cut-about-6-660-jobs-battered-by-plunging-personal-computer-sales-3756866
2. “Dell to cut 6,650 jobs globally amid PC slump” RTE.ie, 6 Feb. 2023, https://www.rte.ie/news/world/2023/0206/1354051-dell-technologies/
3. “Dell layoffs: Thousands of jobs to be cut – Austin Business Journal” The Business Journals, 6 Feb. 2023, https://www.bizjournals.com/austin/news/2023/02/06/dell-layoffs-2023.html
4. “Dell to slash over 6000 jobs amid slump in demand for PCs” Evening Standard, 3 Feb. 2023, https://www.standard.co.uk/business/dell-to-slash-over-6-000-jobs-amid-slump-in-demand-for-pcs-computer-b1058119.html
5. “Dell to Cut 5% of Workforce – WSJ” The Wall Street Journal, 6 Feb. 2023, https://www.wsj.com/articles/dell-to-cut-5-of-workforce-11675688897
6. “Dell to lay off 5% of its workforce” CNN, 6 Feb. 2023, https://www.cnn.com/2023/02/06/tech/dell-layoffs/index.html
7. “Dell to cut 6,650 jobs amid diminishing demand for company’s computers” Fox Business, 6 Feb. 2023, https://www.foxbusiness.com/economy/dell-cut-6650-jobs-diminishing-demand-companys-computers