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IBM cuts 3,900 workforce after missing annual cash target

The layoffs which are related to the spinoff of its Kyndryl business and a part of AI unit Watson Health, will cause a $300 million charge in the January-March period, IBM said.

January 26, 2023 / 09:21 AM IST
IBM's 2022 cash flow was $9.3 billion, below its target of $10 billion, due to higher-than-expected working capital needs. (Image: Reuters)

IBM's 2022 cash flow was $9.3 billion, below its target of $10 billion, due to higher-than-expected working capital needs. (Image: Reuters)

IBM Corporation on January 25 announced 3,900 layoffs as part of some asset divestments and missed its annual cash target, dampening cheer around beating revenue expectations in the fourth quarter, according to a report by .

Chief Financial Officer James Kavanaugh told Reuters that the company was still "committed to hiring for client-facing research and development".

The layoffs which are related to the spinoff of its Kyndryl business and a part of AI unit Watson Health, will cause a $300 million charge in the January-March period, IBM said.

Shares of the company fell 2 percent in extended trading, erasing earlier gains on the largely upbeat results. Analysts said news of the job cuts and free cash flow miss was behind the drop.