Dell Technologies Inc. is eliminating about 6,650 roles as it faces plummeting demand for personal computers, becoming the latest technology company to announce thousands of job cuts.
The reduction amounts to about 5% of Dell’s global workforce, the company said in a regulatory filing early Monday. Dell is experiencing market conditions that “continue to erode with an uncertain future,” Co-Chief Operating Officer Jeff Clarke wrote in memo viewed by Bloomberg. About one-third of Dell’s employees are US-based, according to a March 2022 filing.
After a pandemic-era PC boom, Dell and other hardware makers have seen cratering demand. Industry analyst IDC said preliminary data show personal computer shipments dropped sharply in the fourth quarter of 2022. Among major companies, Dell saw the largest decline — 37% compared with the same period in 2021, according to IDC. Dell generates about 55% of its revenue from PCs.
The move “affirms our expectation of a delayed PC rebound in 2023 and suggests further sales erosion in the company’s client solutions group, especially in 2H,” Woo Jin Ho, senior analyst at Bloomberg Intelligence, said in a note. “Though we calculate the move could cut annual expenses by $700 million-$1 billion, helping to preserve margin and limiting the dent to EPS, Dell still faces limited visibility in PC demand.
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