IBM to Cut Thousands of Jobs by November 2025 Amidst AI and Software Shift

IBM is set to eliminate thousands of positions by November 2025 as part of a strategic restructuring focused on artificial intelligence (AI) and software. The technology giant aims to reallocate resources towards higher-margin segments, including its Red Hat software portfolio and enterprise AI services, in a move designed to boost revenue per employee.

The planned workforce reduction is projected to affect a "low single-digit %" of IBM's approximately 270,000 global employees. This percentage translates to an estimated 2,700 individuals or more, according to reports, as even a one percent cut impacts a significant portion of its workforce. This initiative reflects a broader industry trend where major corporations are streamlining operations and increasing investments in AI capabilities.

The company's strategy involves concentrating resources in areas like Red Hat, which forms a core part of its hybrid cloud offerings, and expanding its enterprise AI services. An IBM spokesperson indicated that while some U.S.-based roles would be impacted, overall employment in the United States is expected to remain flat year-over-year. This suggests a targeted shift in the types of roles and skills prioritized by the company.

Beyond direct layoffs, independent evidence highlights a wider impact of AI adoption on the job market, particularly for entry-level positions. "Independent evidence shows junior employment drops at firms adopting AI, driven more by slower hiring than by separations, which explains why entry-level roles feel tighter," stated Rohan Paul in a recent tweet outlining IBM's plans. This trend underscores a changing landscape where technological advancements are reshaping workforce demands.

Industry analysts note that this restructuring aligns IBM with other tech giants that are increasingly investing in AI tools to improve productivity. The focus on high-growth areas like AI and cloud computing is critical for IBM's long-term competitive positioning and its ability to meet evolving market demands.