Amid slump in sales, job cuts looming at IBM

May 11, 2002|By BLOOMBERG NEWS

ARMONK, N.Y. - International Business Machines Corp., the world's biggest computer company, plans to eliminate as many as 9,600 jobs, a 3 percent reduction, as sales slump, a person close to the company said yesterday.

The reduction will be made by the end of next month, the person said, without indicating where the cuts will be made. IBM's work force has swelled to almost 320,000 from 220,000 in 1994.

IBM has missed sales forecasts by $1 billion in the past two quarters, and chief executive Sam Palmisano is trying to weather the slowdown by planning the biggest job cuts in at least eight years. Palmisano, who succeeded Louis Gerstner in March, told workers last month that "huge, robust growth" in computer-related spending isn't likely to return.

IBM spokeswoman Carol Makovich declined to comment.

The company's shares fell 25 cents to $79.68 yesterday on the New York Stock Exchange.

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