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Ginni Rometty, President and Chief Executive Officer of IBM, speaking at the @Work event in New York, April 2, 2019.
Cindy Ord | CNBC
IBM confirmed Thursday the dismissal of a small percentage of employees, confirming information posted earlier in the day on TheLayoff, an online discussion forum.
A person familiar with the subject stated that the reductions affected about half a percent of employees. According to its latest proxy statement, IBM employs more than 340,000 people, which means that the cuts would affect about 1,700 people.
"We continue to reposition our team to align with the high value-added segments of the IT market, and we also continue to aggressively engage in new critical areas of value to our customers and IBM," he said. at CNBC a spokesman for the company. in an email. The "Jobs" page of the company contains 7,705 job offers.
This reduction comes as IBM seeks to evolve its business through a major acquisition and to achieve its earnings growth goal.
IBM's share is up 16% since the beginning of 2019. In April, the company announced a first-quarter sales revenue down 5% over the previous year and lower than analysts' expectations.
IBM is considering acquiring the free software giant Red Hat for $ 34 billion. The transaction is expected to be finalized in the second half of this year.
IBM has its own public cloud infrastructure for deploying applications, but by buying Red Hat, IBM has also sought to gain traction with companies that adopt other public clouds, such as Amazon Web Services and Microsoft Azure. who both have a bigger market share, according to Synergy. Research group.
IBM announced job cuts in 2016 and 2017.
Earlier this month, ISI 's Evercore analysts, Amit Daryanani and Irvin Liu, emphasized the importance of the Red Hat deal when they started covering the back cover. IBM:
"While IBM's shares will likely be tied in the near term, as investors stay on the sidelines until they better understand IBM's financial profile after the close of the year." Red Hat's acquisition, our positive attitude is based on our favorable view of the RHT operation that has the potential to be transformative as it greatly expands IBM's capabilities and customer reach, "wrote Daryanani and Liu. .
According to its annual report, Red Hat had 13,360 employees as of February 28.
In April, IBM announced at least $ 13.90 of earnings per share, excluding certain items, for 2019. This would be up from $ 13.81 per share, excluding certain elements, in 2018.
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