Key Takeaways IBM is cutting thousands of jobs in Q4 2025, affecting a "low single-digit percentage" of its 270,000-person global workforce. The layoffs target the U.S. infrastructure and cloud divisi...
IBM has begun notifying thousands of employees of layoffs this week as the technology giant accelerates its transformation toward artificial intelligence and cloud software services, according to company statements and industry sources.
The restructuring, which IBM confirmed on Tuesday, will impact what the company described as a "low single-digit percentage" of its roughly 270,000-person global workforce.
Based on those figures, the cuts could range from 2,700 to 5,400 workers, though internal sources suggest the actual numbers may be higher in certain divisions.
"We routinely review our workforce through this lens and at times rebalance accordingly," an IBM spokesperson said in a statement. "In the fourth quarter we are executing an action that will impact a low single-digit percentage of our global workforce."
The company added that while some US-based roles would be affected, it anticipates that US employment will remain roughly flat year-over-year.
According to sources familiar with the matter who spoke to The Register, the layoffs are hitting IBM's US infrastructure group particularly hard. Insiders report that approximately 45% of the US infrastructure division is targeted for reduction, with more than 50% of the US Cloud group expected to be let go.
Employees receiving so-called Resource Action notifications have been given 30 days to find another position within the company or face termination with severance pay. Most affected workers are not expected to find internal transfers and will leave the company, sources said.
The cuts appear concentrated in IBM's Cloud Classic infrastructure-as-a-service business and various support functions.
Former employees and industry observers have noted that IBM has historically shifted many eliminated US positions to India and other overseas locations, though sources suggest this round may differ from past patterns.
Under CEO Arvind Krishna, who took the helm in 2020, IBM has been working to refocus the company around two core technologies: hybrid cloud and artificial intelligence.
The strategy includes heavy investment in the company's Red Hat division and its Watsonx AI platform.
IBM reported strong third-quarter results in October, with profits of $1.7 billion on $16.3 billion in revenue, representing a 9% increase.
The company's Infrastructure segment delivered revenues of $3.6 billion, up 17%, with gross profit margins of 57.2%.
However, the company has also faced challenges with slower growth in its cloud software business, raising concerns among investors about IBM's ability to fully capitalize on surging demand for AI-powered cloud services. IBM's stock, which has climbed more than 35% in 2025, declined nearly 2% following news of the layoffs.
The layoffs come as IBM and other technology companies grapple with AI's impact on employment.
Earlier this year, Krishna indicated that IBM would stop hiring for certain back-office positions that could be automated by AI, particularly in human resources and administrative functions.
In an interview with Bloomberg, Krishna estimated that roughly 30% of IBM's 26,000 back-office workers could eventually be replaced by AI automation.
The company has deployed an AI system called AskHR that handles approximately 94% of routine HR queries, contributing to reported productivity gains of $3.5 billion across more than 70 job roles.
Despite these automation efforts, Krishna has maintained that IBM's overall headcount has grown as the company reallocates resources to higher-value areas like software engineering, marketing, and sales. The company currently lists 2,840 job openings in India, 376 in the US, 228 in Japan, 225 in the Philippines, 127 in the UK, 112 in Canada, and 96 in Mexico.
IBM joins a growing list of technology companies announcing workforce reductions in 2025.
Amazon recently revealed plans to cut approximately 14,000 corporate jobs, while Oracle, Microsoft, and Meta have also implemented layoffs as the industry restructures around AI priorities.
According to Layoffs.fyi, which tracks technology sector job cuts, more than 112,000 employees have been laid off across 218 technology companies in 2025 so far.
The restructuring at IBM reflects a broader pattern in the tech industry where established firms are moving away from legacy infrastructure and services, and working toward software, cloud, and AI-enabled offerings.
The shift has left roles tied to older business lines increasingly vulnerable, while creating demand for engineers, data scientists, and cloud specialists.
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