Dell workforce shrinks again in FY26, AI strategy drives layoffs and hiring slowdown: Report
Dell Technologies reduced its global workforce by approximately 10%, or approximately 11,000 employees, in fiscal 2026, according to its annual report published Monday, March 16.
Reuters said the company had about 97,000 employees as of Jan. 31, up from about 108,000 a year ago. This follows a similar decline of around 10% in fiscal 2025, indicating a continued downward trend in the workforce.
Cost reduction through limited hiring
The layoffs reflect Dell’s strategy to limit outside hires as it reportedly focuses on cost control while investing in fast-growing areas such as artificial intelligence.
According to the news agency, the company spent $569 million on severance payments during the period, up from $693 million the previous year; This shows that restructuring costs are gradually decreasing.
AI server business boosts growth outlook
Despite workforce cuts, Dell remains bullish on its AI-focused business.
The company said last month that it expects revenue from its AI-optimized server segment to double by fiscal 2027, signaling a shift toward high-performance computing and enterprise AI infrastructure.
Shareholder returns are strengthening
In February, Dell announced a 20% increase in its cash dividend and authorized an additional $10 billion for a share buyback program.
The company’s shares are up more than 24% so far this year, reflecting investors’ optimism about its AI strategy.
Broader tech layoffs signal industry shift
Concerns about AI-induced disruptions are growing in Silicon Valley. So far this year, more than 60 tech companies have cut more than 38,000 jobs, according to Layoffs.fyi.
Meanwhile, Meta Platforms is reportedly planning a major layoff that could affect 20% or more of its workforce, underscoring a broader industry restructuring.
