Dell’s year-on-year shipments in the fourth quarter of 2022 declined by 37%, analysts’ reports noted.
American multinational tech major Dell has announced to slash around 6,650 jobs worldwide as personal computers demand declines and the market braces for an expected recession this year. Reportedly, the job cut would affect about 5% of Dell’s global workforce.
According to a Reuters report, the PC maker had previously paused hiring and put limits on travel as a part of its cost-cutting measures. However, the company’s co-chief operating officer Jeff Clarke said in an employee memo that those moves are “no longer enough.”
“We’ve navigated economic downturns before and we’ve emerged stronger,” he added and as reported by Bloomberg. Additionally, more information about the job cuts can be expected when the company reports fiscal fourth-quarter results on March 2.
Dell’s rival HP has also previously announced to lay off up to 6,000 employees over the next three years amid weakening PC demand that reduced its profits and a grim global economic outlook. With this Dell and HP have joined several Wall Street tech giants like Alphabet, Microsoft, Meta, and Twitter that have trimmed their workforce as they brace for a global economic slowdown.
In a nutshell, a setback in consumer spending due to high inflation and the threat of a looming recession this year has pushed corporates to keep a lid on their spending. According to consulting firm Challenger, Gray & Christmas Inc, and as reported by Bloomberg, 97,171 job cuts were announced in the tech sector in 2022 which is up 649% when compared with the previous year.
Meanwhile, PC shipments plunged 29% in the fourth quarter of 2022, as per sales data by Canalys. A 28.5% decline in PC sales in October-December of 2022 was reported by Gartner, and IDC noted a 28.1% decline. Yearly figures from the three firms also showed a sales decline of around 16% in 2022 from the previous year.
Among the top PC makers, Dell emerged as one of the biggest losers, and all three firms reported around a 37% decline in Dell’s year-on-year shipments in the fourth quarter.