According to TheRegister.com, IBM this week began notifying several thousand employees they’ll be laid off unless they find new positions within 30 days. The cuts are expected to hit about 45% of IBM’s US infrastructure group and more than 50% of the US Cloud group under SVP Ric Lewis. IBM reported $16.3 billion in Q3 2025 revenue with $1.7 billion profit, while its infrastructure segment saw $3.6 billion in revenue with 57.2% gross margins. The company currently has only 376 job openings in the US compared to 2,840 in India. An IBM spokesperson confirmed the cuts affect a “low single-digit percentage” of their 270,300 global workforce, meaning 2,700 to 5,400 jobs.
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The profitability squeeze
Here’s the thing that really stands out. IBM’s infrastructure business actually grew revenue by 17% last quarter. So why the massive cuts? It comes down to margins and promises. Ric Lewis reportedly promised profitability in the infrastructure business this year, and apparently that means cutting costs dramatically. When you’re dealing with legacy infrastructure and cloud services, the profit margins can be brutal compared to software or consulting. Basically, they’re choosing to shrink their way to profitability rather than grow into it.
The offshoring reality
Look at those job opening numbers again. 376 openings in the US versus 2,840 in India. That tells you everything you need to know about where IBM sees its future workforce. Current employees cited exhaustion from the “specter of layoffs” and the company’s practice of offshoring jobs from the US and Europe to India. But here’s an interesting twist – one source suggests this round might be different. Maybe these jobs aren’t just moving to India, but actually disappearing entirely as IBM automates or restructures.
What this means for employees
The “Resource Action” process sounds particularly brutal. Employees get 30 days to find another position internally or they’re out. Most won’t find new roles. Anonymous reports are already surfacing on forums like The Layoff and Reddit. Imagine coming to work every day knowing you might be next? The company’s 401K participation numbers tell their own story – down from 52,674 to 49,030 active participants in just one year. That’s a pretty clear indicator of shrinking US headcount.
The bigger tech trend
IBM isn’t alone here. Amazon expects to cut 14,000 jobs, and Oracle is doing similar cuts. But IBM’s situation feels different because of the scale relative to their US workforce. Remember, back in 2002 they had about 160,000 US employees. Now they’re down to roughly 50,000 based on benefit plan participation. That’s a stunning decline over two decades. So while this round of cuts might represent only 1-2% of global workforce, it’s hitting specific groups much harder. The infrastructure and cloud teams are bearing the brunt of what appears to be a major strategic shift.
