New York: IBM Corp on . Wednesday announced 3,900 layoffs as part of some asset divestments and missed. Its annual cash target, dampening cheers for beating revenue . Expectations in the fourth quarter.
Chief Financial Officer James . Kavanaugh told Reuters the company was still “committed to hiring for client-facing . Research and development”.
The layoffs — related to the spinoff of its . Kindle business and a part of AI unit Watson Health — . Will charge $300 million in the January-March period, IBM said.
“It looks like the market is disappointed in the size of its announced job cuts, which is only 1.5% of its workforce. Said Jesse Cohen, senior analyst at Investing.com.
“Investors were hoping for deep cost-cutting measures.”
From big tech to Wall Street banking majors. U.S. companies have cut costs in earnest to better weather the global economic downturn.
IBM’s 2022 cash flow was $9.3 billion. Short of its target of $10 billion, higher than expected working capital needs.
The company forecast annual. Revenue growth in the mid-single digits in constant currency terms, weaker. Than the 12% it reported last year, as pandemic-led demand to. Digitize businesses gave way to cautious spending by . Clients amid fears of a growing recession.
In October, IBM reported softness in new . Bookings in Western Europe while peer Accenture. Plc cited weakness in its consulting business. Cognizant Technology . Solutions Corp cut its 2022 forecast in November due to contract tensions.
Growth in IBM’s software and consulting businesses slowed in . The fourth quarter. But cloud spending was a bright spot, with contract signings doubling . Through 2022 to deploy services with. Partners such as Amazon com’s AWS and Microsoft’s Azure.
Its hybrid cloud revenue rose 2% in the quarter ended Dec. 31.
Total revenue for the period was $16.69 billion. Compared to analysts’ estimates of $16.40 billion, according to Refinitiv.
For 2022, IBM recorded 5.5% revenue growth, the highest in a decade.