IBM has reportedly closed its research and development (R&D) operations in China, marking another major tech company scaling back its presence in the country due to rising geopolitical challenges. According to a report by a Chinese publication, the shutdown of IBM's China Development Lab and China Systems Lab has led to the layoffs of over 1,000 employees across cities like Beijing, Shanghai, and Dalian.
R&D Operations Halted
Over the weekend, employees in IBM’s China R&D units were reportedly unable to access the company’s intranet and services. The South China Morning Post, citing posts from Chinese social media, confirmed that IBM officially announced the job cuts during an internal meeting on Monday morning. The report added that the move has impacted a significant portion of the company's workforce in China, leaving many without jobs as the company repositions its strategy.
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IBM Confirms Layoffs
IBM has acknowledged the job cuts but refrained from disclosing specific details about the number of layoffs. In a statement, an IBM representative emphasized that the company regularly adjusts its operations to better serve its clients, assuring that these changes will not affect its ability to support clients across the Greater China region.
The spokesperson explained that IBM's local strategy will now concentrate on collaborating with Chinese companies, particularly privately-owned enterprises, to co-create hybrid cloud and artificial intelligence (AI) solutions. This approach will leverage IBM's extensive technology and consulting expertise, ensuring continued support for private enterprises and select multinational companies operating in China.
Part of a Broader Trend
IBM's decision to shut down its R&D operations in China comes amid escalating tensions between China and the United States. IBM joins a growing list of global companies, including Ericsson, Tesla, Amazon, and Intel, that have scaled back their China-based operations, leading to significant workforce reductions in the country.
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