International Business Machines Corp said yesterday it plans to slash 3% to 6% of its US server workforce yesterday after warning two weeks ago of diminished profits for its next two quarters. Big Blue wouldn’t disclose the headcount this would translate into, but analysts estimated that between 200 and 500 jobs would go under the plans.
IBM warned last month that profits for its current fourth quarter to December 31 and the first quarter of 2000 would be hit by customers deferring orders to manage the millennium date change. IBM will decide which positions to cut at its server plants in Rochester, Minnesota; Austin, Texas; and Poughkeepsie and Somers in New York during the next five weeks, according to an internal staff memo from senior vice president of the server unit, Sam Palmisano. The lay-offs would account for less than 1% of the total 295,000 people working for the company as of the end of March.
Last month the number-one computer hardware firm said it was axing 5%-10% of its 10,000-strong PC division and it reduced its headcount in Northern California by 1,100 or 10% in June as it transferred storage device operations overseas.
