- Global Equities Research’s Managing Director Trip Chowdhry shared his view of the round of layoffs going on in the tech industry right now.
- According to the note, layoffs in the industry are surging; over the next 12 months, the sector will see about 330,000 dismissals.
“This is just a start,” the analyst stated. Over 2016, he expects to see 1,900 more employees fired at Yahoo – bringing the total to 3,500 layoffs this year.
The firm’s reasons for the layoffs at Yahoo include:
- A shift in users’ behavior.
- A lack of new successful product launches.
- “Inherent efficiencies and productivity gains within the Internet industry, that makes people redundant fast.”
- “Rapid obsolescence of existing employee skills.”
Chowdhry then disclosed his reasons to believe that the tech sector alone will see more than 330,000 firings over the next year. These included:
- “Technology shift to Cloud Native and Mobile Native applications”
- “Improving IT Efficiency by Micro-services, On-Demand and Spot Pricing”
- “Value Migration from Technology Integration to Domain Specific Expertise”
- A shift in consumers’ behavior.
Below is a list of how many employees Chowdhry believes will be fired at specific companies:
- EMC Corporation (NYSE: EMC): between 10,000 and 14,000 layoffs – or 15 to 20 percent of its workforce.
- Hewlett Packard Enterprise Co (NYSE: HPE): about 72,000 – 30 percent.
- HP Inc (NYSE: HPQ): roughly 86,000 – 30 percent.
- International Business Machines Corp. (NYSE: IBM): about 95,000 – 25 percent.
- Cisco Systems, Inc. (NASDAQ: CSCO): about 14,000 – 20 percent.
- Juniper Networks, Inc. (NYSE: JNPR): about 1,300 –15 percent.
- Oracle Corporation (NYSE: ORCL): about 26,000 – 20 percent.
- Microsoft Corporation (NASDAQ: MSFT): about 18,000 – 15 percent (“Microsoft is letting go about 200 to 250 people every week, and none of these are ever announced")
- NetApp Inc. (NASDAQ: NTAP): about 1,800 – 15 percent.
- Symantec Corporation (NASDAQ: SYMC): about 2,800 – 15 percent.
- F5 Networks, Inc. (NASDAQ: FFIV): about 450 – 10 percent.
- Yelp Inc (NYSE: YELP): about 1,000 – 30 percent.
Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.
Latest Ratings for YHOO
|Feb 2016||B. Riley||Maintains||Neutral|
|Feb 2016||Cowen & Company||Maintains||Market Perform|
|Feb 2016||Credit Suisse||Maintains||Neutral|
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