IBM will lay off a “low single-digit percentage” of its global workforce, the company confirmed this week, as part of a wider effort to streamline operations and invest more heavily in artificial intelligence, hybrid-cloud, and software.
With a total headcount of roughly 270,000 employees, the reduction could affect several thousand positions worldwide. IBM has not released a specific figure or breakdown by region.
In a statement shared with media, the company described the move as part of an ongoing “workforce rebalancing” strategy to align resources with growth priorities. A company spokesperson said U.S. employment would remain “flat year over year,” suggesting most cuts will occur abroad.
Strong revenue, shifting priorities
The restructuring comes despite steady top-line growth. IBM reported $16.3 billion in revenue for Q3 2025, up 9% year-on-year, or about 7% at constant currency. The company said it continues to see demand for AI-driven software and hybrid-cloud services, particularly through its watsonx platform.
IBM’s consulting division grew modestly but faced margin pressure, while software remained the main contributor to earnings. The company reaffirmed its full-year 2025 outlook for revenue growth above 5% on a constant-currency basis.
Executives have emphasized that workforce adjustments are not a signal of distress, but of structural realignment, moving labor and capital away from legacy IT operations toward more scalable AI and automation technologies.
Part of a wider tech-sector pattern
IBM’s layoffs mirror similar decisions across the technology industry. In 2025 alone, Google, Meta, and Amazon each reduced their global headcounts by between 3% and 6%, citing efficiency gains and reallocation of resources to AI and cloud computing.
Analysts note that while the AI boom has lifted corporate productivity, it has also reduced labor demand in support and administrative functions, leading firms to consolidate around automation and software-driven workflows.
IBM has been repositioning itself for several years. It spun off its infrastructure-services arm, Kyndryl, in 2021, and has since expanded into hybrid-cloud infrastructure, data-management tools, and enterprise AI. The company says it intends to “simplify operations and accelerate client outcomes” through automation.
Implications for workers and industry
For employees, the announcement underscores an emerging paradox in the AI economy: even as technology companies expand their influence, they are becoming leaner employers.
Economists and labor experts expect this trend to continue, as large enterprises incorporate generative AI and process automation into internal systems, eliminating repetitive or intermediary roles rather than adding new ones.
The U.S. Department of Labor is currently reviewing the long-term impact of AI on employment patterns. Early findings suggest that the technology’s effect on jobs may be less about total losses and more about redistribution, shifting labor demand from traditional corporate support toward data, design, and system-integration roles.
The Nth Authority’s Takeaway
IBM’s move illustrates the next phase of the AI transition: not explosive hiring, but targeted optimization.
It’s a rational step for a company balancing legacy infrastructure with emerging technologies but also a reminder that the pursuit of efficiency often displaces stability.
In the coming quarters, IBM’s performance will test whether a smaller, sharper workforce can truly capture the growth it’s chasing or whether the efficiencies of AI, once again, outpace the humans trying to harness them.
