Dell Technologies Cuts 6,650 Jobs, Remakes Support, ISG Teams

‘Steps we’ve taken to stay ahead of the downturn impacts … are no longer enough. We now have to make additional decisions to prepare for the road ahead,’ wrote Dell Co-COO Jeff Clarke in a memo to employees Monday.


Dell Technologies is reorganizing key departments and cutting staff as it hopes to mitigate the hit from a global economic downturn that has ravaged other high-profile technology vendors with thousands of job cuts so far this year.

Jeff Clarke, Dell’s vice chairman and co-COO, announced the 6,650 layoffs in a memo Monday that outlined how the company had tried to stave off job cuts with hiring freezes, travel restrictions and expense reductions that ultimately failed to turn conditions to Dell’s advantage.

“Steps we’ve taken to stay ahead of the downturn impacts … are no longer enough. We now have to make additional decisions to prepare for the road ahead,” Clarke wrote. “In the coming days and weeks, you’ll begin to see a series of changes, some resets, across the organization to better structure us for the future, to better collaborate, reduce complexity, increase speed and to accelerate innovation. They’ll help us focus on purpose-driven work and be in the best position to make the greatest difference for customers, Dell Technologies and each other. You’ll hear from your leader soon about any changes that may impact your team.”

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[RELATED: 40,000 Tech Layoffs: Amazon Vs. Google Vs. Microsoft] Dell told the U.S. Securities and Exchange Commission the job cuts will result in a reduction of approximately 5 percent of Dell’s workforce. The approximately 133,000-employee company expects to recognize expenses associated with these actions in the fourth fiscal quarter of fiscal 2023.

Global Sales Organization Impacted

Dell is making changes to the global sales organization, where it will align regional sales and Dell Technologies Select teams to cover customer and partner relationships worldwide. Support teams will realign along similar lines.

Dell services will integrate support service from the Infrastructure Support Group and Commercial Group to “tighten the feedback loop” between its customers, the support teams and the product teams. Clarke wrote that the changes will keep the cost of services closer to the “control points” for those costs in engineering and product design. He wrote that Dell will now be able to “develop more integrated solutions more quickly.”

Within the Infrastructure Support Group, which handles servers, storage and Apex products, Dell has “shifted teams and resources to the priority offerings that will best serve our customers and partner needs.”

“Unfortunately, with changes like this, some members of our team will be leaving the company,” Clarke wrote. “There is no tougher decision, but one we had to make for our long-term health and success. Please know we’ll support those impacted as they transition to their next opportunities.”

Slow PC Sales Despite Record Revenue

Dell posted its highest revenue numbers in 2022, with global sales topping $101 billion, but slow PC sales hit earnings in the most recent quarter as Dell’s revenue shrank 6 percent against the previous year. Research firm IDC also reported that Dell’s PC shipments fell 37 percent during the holiday quarter.

Dell’s infrastructure business offset those pressures with stronger sales. And, as of the end of October, Dell’s sales through three quarters was up 6 percent year over year.

Clarke told the remaining employees that despite the layoff of 6,650 of their co-workers, he is confident in the company’s future.

“Remember, we’ve navigated economic downturns before and we’ve emerged stronger,’ he wrote. “We’ll prevail as we always do, for our customers, partners and each other. We’ll be more competitive, more focused and find a new level of operational performance. We will be ready when the market rebounds.”