IBM is considering reducing its office space in India by half, as the work-from-home model gains popularity after the COVID-19 outbreak. The company plans to discontinue lease agreements at half of its offices in India, according to a report by The Economic Times.
The US-based technology giant has more than 10 million square feet of rented office space across major cities such as Bengaluru, Hyderabad, Noida, Gurugram and Kolkata.
Moneycontrol could not independently verify the story.
IBM declined to comment when contacted by The Economic Times.
IBM has over 10,00 employees in India and several temporary staff, the report said.
"Maybe 25 percent of people need to come to the office regularly. For others, it will be flexible, and their workspace will also be the same," a source told the publication.
Also read: IBM sees more cloud partnerships with IT firms coming its way
The report did not specify a timeline for IBM's reduction of leased office space in India.
The company will evaluate several lease agreements that are scheduled for renewal, but it would not impact half of such contracts, an executive told the paper.
Some analysts told the paper that IBM's plan to reduce leased office space is an effort to cut costs.
"There is a lot of pressure in terms of top line and bottom line for all IT Services companies, so at some stage, the need to reduce costs is critical. All companies are focusing on automation and there are a large number of employees working from home now," Sanchit Vir Gogia, chief executive of Greyhound Research, told the paper.
Most employees at IT offices in India have been working from home since the lockdown began on March 25.
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