German software developer SAP is the first European technology company to announce headcount cuts after a 56% profit drop
Many tech companies are cutting benefits after the pandemic boom, and the industry continues to announce reorganizations and workforce cuts. Now it’s the turn of IBM, which has revealed it will cut 3,900 jobs after a 71% profit cut, and SAP, which will make a 2.5% cut of its workforce, which equates to about 3,000 workers.
SAP, a German software developer, is the first European technology company to join the wave of layoffs that has been going on for months with Meta, Twitter or Amazon as the main losers. The multinational announced on Thursday that its net profit has fallen by 56% compared to 2021 to 2,290 million euros.
The German company has announced that it will implement a specific restructuring program in selected areas of the company in 2023 with the aim of focusing on strategic growth areas, as well as strengthening its core business and improving overall efficiency.
The program is expected to affect approximately 2.5% of employees, who expect the bulk of the restructuring costs of €250-300 million associated with the program to be accounted for in the first quarter of 2023.
For its part, the American IBM decided to cut 3,900 jobs, 1.5% of its workforce after a profit that was 71% lower than last year, still of 1,500 million euros. The job adjustment will focus on the spin-off businesses of Kyndryl and Watson Health, which will cost the company about $300 million (275 million euros).
They also pointed out that their full-year 2022 net income decreased by 71.5% compared to that of 2021, to $1,639 million (1,504 million euros), due to the negative impact of $5,900 million (5,415 million euros) assumed by the company in the third quarter as a result of the pension agreement reached.
Source: La Verdad
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
