Dell COO Clarke notifies employees about layoffs that start this week

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On Monday, Dell Chief Operating Officer Jeff Clarke notifies employees the company will start cutting jobs this week. (Pixabay)

On Monday, Dell Chief Operating Officer Jeff Clarke notified employees the company would start cutting jobs this week. Bloomberg reported that Clarke notified employees about the job cuts during a quarterly meeting. Round Rock, Texas-based Dell had about 165,000 global employees at the start of the year, including 31,000 at VMware.

RELATED: VMware lays off some employees as part of 'workforce rebalancing'

In January, VMware laid off some of its employees, but didn't say how many or in what areas.

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According to a post on TheLayoff.com, Dell was planning "big" cuts in its data center and HCI divisions, medium cuts in IT, more staff reductions in HR and "sales will be impacted next quarter." The post also said there would be minor cuts in the desktop division in Round Rock and on the East Coast. The post also said Thursday and Friday of this week would be the days to watch for layoffs.

Dell didn't say how many employees were being laid off or in which areas of its business.

“We’re also evaluating our business to make sure we have the right number of team members in the right roles and in areas where customers need us most,” Dell said in a statement. “We’re addressing our cost structure to make sure we’re as competitive as we should be now and for future opportunities."

“While we do this type of organizational review regularly, and while it always results in some job loss or restructuring, we recognize that there is nothing routine about today’s environment. We updated our team today with this information so they understand the actions occurring this week.”

Dell's overall revenue was down 2.7% its recent second quarter as it struggled to adjust to the fallout from the coronavirus pandemic. The Covid-19 pandemic did lead to a boost in demand for Dell's notebooks and software products for remote workers and online learning. The pandemic also increased cloud use as remote workers, teachers and students access their data, services and applications from various clouds.

On the flip side, data center sales dropped by almost 5% to $8.21 billion as companies shifted their spend to remote work solutions.  

RELATED: Dell COO: 60% of employees will WFH or go to a hybrid model

On last month's Q2 earnings call, Clarke said that 60% of Dell's workforce would stay remote or have a hybrid schedule where they largely work from home, but come into the office once or twice a week.

During Monday's meeting, Clarke said employees could work from home as much as they wanted as long as they had manager approval, according to Bloomberg. Dell will also give its remote workers a one-time stipend of $400 for home-office equipment.

Dell previously suspended 401(k) matches, bonuses and promotions for the fiscal year. Dell CEO Michael Dell also said he would forgo his $950,000 salary this year.

While Dell cuts costs and trims its workforce, there looks to be numerous new product launches and announcements from Dell and VMware at VMworld. The virtual version of VMworld will run from Sept. 29 to Oct. 1.

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