VMware to 'axe 900 jobs'

Virtzilla not to be outdone by cost-cutting dominant shareholder EMC

VMware is mimicking cost-cutting actions at alpha shareholder EMC by pushing through its own job cull: 900 roles, to be specific, or some five per cent of the 18k-strong global workforce.

The axe is being shined by Virtzilla, reportedly to counter a weaker sales pipeline and share price drop. Let’s face it, nothing gets financial analysts’ attention like an old-fashioned cost purge.

According to a report, VMware might go public on the redundancies this week when it reports the latest set of financials. The company refused to comment.

Staff leapt onto job boards to relay the feelings of concern and vent frustration with the management team.

One wrote, “it’s not looking good right now - the management is desperate to meet the numbers and the sales cannot support it. The only way for them to survive the brunt of Wall Street is to cut highest expense - employees”.

EMC, which currently owns an 81 per cent stake in VMware - the other 19 per cent was floated in 2007 - revealed just prior to Christmas it was slashing costs by $850m.

This is ahead of Dell’s $67bn acquisition of EMC, a deal that doesn’t sit well with some VMware investors who are concerned Dell will get the company on the cheap as part of a buy-back plan.

The share price for the public element of VMware is currently $49.50 versus the 52-week high of $93.43.

EMC has moved VCE into the fold under the guise of a new exec, and in this part of the business, job cuts are also happening. ®

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