Dell’s total workforce has shrunk by 10% or 11,000 employees, in fiscal 2026 according to the company. The company spent $569 million in severance payments in this period, compared with $693 million a year ago, its annual report showed. This is the third year in a row where Dell’s workforce has reduced by 10%.
Several big tech companies have conducted mass layoffs of late. This year, Amazon has already cut 16,000 jobs, Jack Dorsey’s fintech firm Block has slashed half its workforce, and the software company Atlassian has laid off 4,000 employees. Dell, however, is taking a different approach by quietly but systematically shrinking its head count.
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The company now has 36,000 fewer employees than in February 2023 — a 27% decline over three years. Dell said in the filing that throughout its 2026 fiscal year, it had reduced costs through measures including “employee reorganizations, limitation of external hiring, and other actions to align our investments with our announced strategic and customer priorities.”
“We are always assessing our business to remain competitive and ensure we are set up to deliver the best innovation, value, and service to our customers and partners,” Dell said in a statement to Business Insider.
This comes amid concerns about the impact of artificial intelligence on the workforce. Memos from the CEOs of Atlassian and Block indicated that the technology played a role in recent decisions. While Dell may be less overt about announcing employee reductions, like others in the industry, it is undergoing a major modernization push as it prepares for an AI-driven future. In its Form 10-K filing, Dell said it had been committed to “cost management in coordination with our ongoing business modernization initiatives.”
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In its latest annual results, revenue in Dell’s Infrastructure Solutions Group (ISG), which sells servers and storage infrastructure, rose 40% in its 2026 fiscal year. The company also said that it expected AI-optimized server revenue to double in 2027.
Internally, Dell is preparing to roll out standardized processes across its operations and launch a single enterprise platform, an initiative it has called “One Dell Way.” In a January memo, Dell told staff the systems overhaul would be the “biggest transformation in company history,” according to Business Insider.
Dell, whose shares have risen over 24% so far this year, said last month that it expects revenue from its key AI-optimized servers business to double in fiscal year 2027. In February, it announced a 20% hike in its cash dividend and an additional $10 billion for its share repurchase program.