Dell cuts workers in sales team reorganization with new AI-focused unit

Dell previously announced a major workforce reduction in early 2023, shedding 13,000 jobs in that fiscal year

Dell Technologies Inc. is cutting jobs as part of a reorganization of its sales teams that includes a new group focused on artificial intelligence products and services.

“We are getting leaner,” sales executives Bill Scannell and John Byrne wrote Monday in a memo to Dell employees. “We’re streamlining layers of management and reprioritizing where we invest.” In addition to the AI-focused team, the executives said the company will change how data center sales are approached.

The Texas-based hardware technology company has enjoyed a renaissance of investor interest over the past year due to its high-powered servers that can run AI workloads. Still, there is increasing unease about how long it may take companies to see a payoff from AI investments, which often come in the form of expensive servers or graphics processing units.

A spokesperson declined to comment on how many jobs would be affected. “Through a reorganization of our go-to-market teams and an ongoing series of actions, we are becoming a leaner company,” the spokesperson said.

The shares increased 34% this year through Friday’s close, though the stock had given back more than 40% of its value since hitting a record $179.21 on May 29.

Dell previously announced a major workforce reduction in early 2023, shedding 13,000 jobs in that fiscal year. As of February, it had about 120,000 full-time employees globally, Dell said in a regulatory filing that month.

The company’s best-known business of selling personal computers has struggled in recent years amid a post-pandemic decline in that market. Still, computer industry shipments have begun to pick up, and Dell is optimistic that a new generation of AI-optimized PCs will fuel upgrades.

“We aim to grow faster than the market by seamlessly meeting our customers and partners online, virtually, or in person, to unlock the value of modern IT and AI for their organizations,” the Dell executives wrote in the memo to employees.