Data Centre


VMware: New year, new job – you're fired

Make like a virtual machine, and migrate out of here, small percentage of staff told

By Chris Mellor


Updated Virtualization kingpin VMware is this month laying off staff again.

Exactly how many, the biz isn't saying. It sounds as though mainly marketing staff are being dropped – as much as 20 per cent of that department's employees getting the chop, allegedly – with perhaps around 150 to 200 workers being axed in total, according to internet whisperings. CNBC reported a small percentage of VMware's 22,000-strong workforce will be affected.

In a statement to El Reg on Friday, a VMware spokesperson said:

We can confirm that there has been a small reduction in force at VMware in January 2018. Work force rebalancing is a continual activity across VMware’s businesses and geographies to ensure that resources are aligned with business objectives and customer needs. We continue to recruit in areas of strategic importance for the company.

Dell-EMC-owned VMware – based in Palo Alto, California – also had this little FAQ prepared in answer to our questions, which we've included for your amusement. You'll see what we mean as you read through it.

Q. Why was this effort needed? What changes are being made?

A.  VMware regularly evaluates its workforce and looks for opportunities to streamline business processes, advance innovation, focus on customer needs, and deliver better results.

Q. Is this restructuring announcement due to VMware’s financial performance?

A.  Work force rebalancing is a continual activity across VMware’s businesses and geographies to ensure that resources are aligned with customer needs.

Q. What is VMware doing to help the displaced employees?

A. VMware provides a comprehensive package of transition benefits for affected employees. This includes financial support (severance pay) and professional career transition support services to help employees move to the next phase of their careers.

Q. How much money will VMware save through this activity?

A.  This decision will help to streamline business processes, advance innovation, and deliver better results for the company.

Q. Will there be a financial impact on VMware’s Q4 earnings?

A.  We’re not commenting on the current quarter.

Q. How will this announcement affect VMware customers?

A.  This announcement will not affect customer relationships. Customers will still have access to VMware’s full portfolio of services with the same level of quality.

Q. How many VMware employees are impacted?

A.  We are not disclosing these details, beyond publicly available information.

Q. Will there be more layoffs?

A.  We have nothing further to announce at this time.

Q. How many employees does VMware have?

A.  As of the end of VMware’s third fiscal quarter 2018 (November 3, 2017) VMware reported it employed approximately 21,557 people worldwide.

VMware is not short of cash. According to its latest financial results – covering the third quarter of 2017 and published at the end of November – it trousered revenues of $1.98bn, up 11 per cent year-on-year and $20m more than analysts expected, a $443m profit, up 40 per cent, and earnings-per-share seven cents ahead of expectations at $1.34. Shareholders were rewarded with a stock buyback plan of up to $1.2bn in class-A common shares.

Dumped employees may well feel that the company values its shareholders much, much more than its workers. ®

Updated to add

According to paperwork submitted to California state officials, as required by law, VMware laid off 159 people this month.

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