Kamalanomics Strikes Again: Dell Announces Layoffs of Up to 12,500 Employees

Dell Technologies is undergoing a significant restructuring, which includes layoffs and the formation of a new group dedicated to artificial intelligence services, according to sources. The company will reportedly lay off 12,500 employees representing 10 percent of the company’s headcount.

Silicon Angle reports that Dell is navigating through a period of change as it lays off a large number of employees while simultaneously reorganizing its sales and marketing teams. Sources familiar with the matter have revealed that the restructuring efforts include the establishment of a new group specifically focused on artificial intelligence services.

Although the exact number of layoffs remains unconfirmed, one source close to the situation initially suggested that approximately 12,500 employees, or roughly 10 percent of Dell’s global workforce, were set to be let go starting Tuesday. In February 2023, Dell filed a 10-K with the Securities and Exchange Commission, indicating a reduction of about 6,000 employees.

The company has declined to provide specific details regarding the layoffs. In an email to SiliconANGLE, Dell stated, “Through a reorganization of our go-to-market teams and an ongoing series of actions, we are becoming a leaner company. We are combining teams and prioritizing where we invest across the company. We continually evolve our business so we’re set up to deliver the best innovation, value and service to our customers and partners.”

An internal memo from Bill Scannell, president of global sales and operations, and John Byrne, president of sales for Global Theaters and Dell Technologies Direct, reportedly informed employees, “We are getting leaner. We’re streamlining layers of management and reprioritizing where we invest.”

Rumors of the layoffs have been circulating on TheLayoff.com website, with one person claiming, “Despite whatever person from corporate put in here earlier about this being a one percent layoff, it is in fact larger than that and is hitting services, sales, marketing & engineers. Half of my team is gone in marketing and still no coms.”

This latest round of layoffs follows a series of staff reductions at Dell over the past year. According to CRN, the company laid off a total of 13,000 employees last year, including 6,000 in February 2023 and an unspecified number in August.

Dell’s most recent quarterly results disappointed investors, with shares plummeting nearly 18 percent on May 31, the day after the report. Analysts raised concerns about the impact of rising demand for artificial intelligence servers on the company’s overall profitability. Dell officials anticipated a decrease of approximately 150 basis points in the company’s gross margin for fiscal 2025 due to the increased mix of AI servers, inflationary input costs, and heightened competition.