Dell is reportedly laying off staff from its China operations, with affected personnel only having until October 10 to apply for open internal positions. Some of the affected departments include its EMC storage division and the Client Solution Group (CSG), which according to Digitimes, affects Dell's offices in Shanghai and Xiamen. However, the company has not publicly announced this reduction-in-force yet, so it’s unclear how many people are affected.
This latest news of layoffs comes amid the company’s restructuring to boost profitability. Around a year ago, it was estimated that Dell let go of over 12,000 positions, reducing its workforce by around 10%. The company has not been hiring externally and has even made a leadership adjustment with the departure of Yvonne McGill as its CFO, after nearly 30 years of working with the PC maker. Dell did not say why McGill is leaving her position, but clarified that it was not related to the company’s financial reporting or internal controls.
The EMC storage division is the company’s enterprise storage arm, focusing on delivering solutions to storage, server, and data protection services to IT departments, data centers, and other institutions. On the other hand, CSG delivers end-user hardware, like laptops and monitors, to consumers and companies. These divisions are historically important for Dell’s presence in China, but the changing geopolitical landscape and market demands are making strategic contraction a necessity for the company to adjust to shifting realities.
Other companies have also been caught in the crossfire between the U.S. and China’s trade war. Microsoft closed its AI and IoT labs in the East Asian nation last year, with Redmond asking nearly 10% of its China-based workforce to relocate to the U.S., Ireland, Australia, or New Zealand. IBM also shuttered its research and development facilities in the country in August 2024, resulting in the retrenchment of over 1,000 people.
Even Nvidia is facing some trouble in China after the U.S. banned the export of its H20 AI GPUs in April. The White House eventually allowed it to sell the advanced chips again, this time by issuing export licenses to the company. However, it only allowed this after Nvidia and AMD agreed to share 15% of their China revenue with the federal government. Deliveries still aren’t being made, though, as the Commerce Department still has a massive backlog of export licenses to process, and Washington’s lawyers are still figuring out the legality of the 15% ‘export tax’.
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