IBM to wind down its Russian business and lay off staff

8 Jun 2022

Image: © Nikolay N. Antonov/

IBM first suspended its Russian operations in March in response to the invasion of Ukraine but had continued to pay its employees in the country.

Technology giant IBM has announced plans to wind down its operations in Russia and has begun to lay off its staff, as a response to the ongoing invasion of Ukraine.

In a memo to staff made public yesterday (7 June), IBM chair and CEO Arvind Krishna said the decision was made due to “uncertainty” on the long-term ramifications of the war, while “the consequences of the war continue to mount”.

“We see this move as both right and necessary, and a natural next step following our business suspension,” Krishna said.

The 110-year-old tech giant suspended its operations in Russia in March, when many global tech players took measures against Russia in response to the invasion of Ukraine. Krishna said this decision was made to evaluate long-term options, while the company continued to pay its Russian employees.

Last month, Krishna told Reuters that the company was unsure how much longer it could pay its staff in Russia, as sanctions against the country continued to escalate. Reuters reported that IBM has more than 1,000 workers in Russia.

“Our colleagues in Russia have, through no fault of their own, endured months of stress and uncertainty,” Krishna said. “We recognise that this news is difficult, and I want to assure them that IBM will continue to stand by them and take all reasonable steps to provide support and make their transition as orderly as possible.”

In an earnings call for its first-quarter results this year, IBM senior VP and chief financial officer James Kavanaugh said the Russian business was “not large, but it’s concentrated in high-end infrastructure and software”. He said business in the country contributed around $300m of revenue and roughly $200m in profit and cash.

In April, the EU issued a fifth round of sanctions against Russia in relation to its invasion of Ukraine. This included a ban on providing high-value crypto services to Russia in a bid to “close potential loopholes”.

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Leigh Mc Gowran is a journalist with Silicon Republic