Layoffs in technology companies continue: SAP will lay off 3,000 employees, and IBM, 3,900

Follow the trickle of technology companies that announce that they are going to do without a significant part of their workforce. The last technology layoffs announced will be produced in SAP and IBM. The first will cut around 3,000 jobs, while the second will lay off 3,900 of its employees.

SAP has made the decision to lay off 2.5% of its workforce after seeing how its profit has been reduced in 2022: it has fallen by 56.4%, to 2,290 million euros. The company has confirmed the layoffs during the communication of its quarterly and annual results for 2022. It has also announced the launch of a company restructuring program throughout this year in some of its divisions, in order to focus for the future in the areas of SAP that are considered strategic growth, as well as in the cloud transformation.

On the other hand, SAP has assured that with this restructuring it will strengthen its core business, in addition to improving its efficiency as a company. It is expected that the largest part of the company’s restructuring costs, estimated to be between 250 and 300 million euros, will be accounted for during the current quarter of 2023.

In addition, SAP has confirmed that its results have met all forecasts for its fiscal year 2022. Its cloud revenues have improved by 33% in general, and in particular, those of S / 4HANA obtained in the fourth quarter of 2022 have increased by 101 % up to 660 million euros. The company’s cloud revenues reached 3,390 million euros in the fourth quarter of the year, 30% more. Its gross profit in 2022 is up 38%, and its operating profit remains flat.

SAP software license revenue fell 38% in the quarter to €910 million. Meanwhile, cloud and software revenue rose 4% to €7.29 billion. In terms of income from services, they improved by 15% and reached 1,140 million euros. By 2023, the company, which has decided to study the sale of its stake in Qualtricsexpects its revenue to accelerate, and its operating profit to grow in double digits.

layoffs at IBM

As for IBM, it has confirmed the layoffs in a meeting after the communication of its results. In total, according to CNBC, they account for the 1.5% of your workforce globally, and according to the IBM CFO Bret Kavanaugh, will focus on the workers who remain at IBM after creating the Kyndryl and Watson Health subsidiaries and who worked at them until their spin-off. The costs derived from the compensation for their dismissals will have an impact of about 300 million dollars. Of course, Kavanaugh has assured that IBM will continue hiring in the areas that they consider will have the greatest growth.

IBM’s revenues for the last quarter of the year have reached $16.7 billion, exceeding expectations. In addition, its shares have earned $3.60 per share. Its hybrid cloud revenue for all of 2022 has been $22.4 billion, up 11% from 2021.

As for sales in the software division, they rose 2.8% to $7.29 billion. Those of Infrastructure rose 1.6% to 4,480 million dollars, and those of consultancy improved 0.5% to stay at 4,770 million dollars. The Red Hat revenue rose 10% in the last three months of the year.

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