Earlier this month, Dell announced the restructuring effort centred around artificial intelligence integration, implementing workforce reductions starting this week across different departments, leading to what some employees believe could be the largest round of layoffs in the company’s history.
“Through a reorganisation of our go-to-market teams and an ongoing series of actions, we are becoming a leaner company,” a Dell spokesperson told Business Insider.The layoffs are expected to continue throughout the quarter, affecting multiple divisions within the organisation.
According to internal sources who spoke to Business Insider on condition of anonymity, Dell aims to reduce its workforce to under 100,000 employees, down from approximately 120,000 full-time staff reported in May. However, Dell has not officially confirmed these numbers.
The restructuring aligns with Dell’s new AI strategy, which has been in internal trials since October 2023. Vivek Mohindra, SVP of corporate strategy, explained to the outlet that AI tools would enhance staff efficiency and free up time for more critical tasks.
“Purely from a business perspective, it makes sense,” one employee stated, noting that some roles involved only providing statements of work to another division. “There is a desire to considerably downsize this specific workforce and replace them with AI solutions for sellers to be more self-sufficient and to speed up our current solutioning processes,” the employee added.
Another employee likened the situation to “a bit of a dumpster fire,” with staff anxiously watching their inboxes for meeting invitations that could signal job cuts.
The impact of the layoffs has been felt across the company. A sales support employee described the current atmosphere to Business Insider: “This is horrible short-term for morale. I wouldn’t be surprised if it’s going to be in the dumpsters until the next Tell Dell or until we see third-quarter earnings.”
While many employees understand the business rationale behind the restructuring, concerns remain about its implementation and impact on team dynamics. A senior engineer noted, “Most of it makes sense … reductions in sales and marketing because we’re relying more heavily on external sales channels that have deeper relationships with customers.”
The restructuring comes as Dell’s valuation dropped to just over $64 billion. As Dell navigates this AI-driven transition, some employees view the layoffs as an inevitable consequence of technological advancement. “I expected it. It’s a new quarter, and they’re working on getting all support AI-focused,” a laid-off sales worker told Business Insider, adding, “I’d rather be let go with a package than quit.”
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