Amid the uncertainty surrounding VMware’s takeover by Broadcom, employees have awaited their fate. It’s not the first time that VMware has trimmed its workforce after a takeover, but it may be the most impactful as far as the company’s current employees are concerned. The uncertainty has caused a great deal of anxiety among staff, especially managers who are unlikely to have any say in how their teams will be divided up, a source familiar with the situation told Business Insider.
Bloomberg News reported that the chipmaker will lay off about 1,300 VMware employees in California, including those in sales, program management, and marketing. According to regulatory filings in those states, the company also plans to eliminate positions in Washington, Colorado, and Georgia. Broadcom did not immediately respond to a Reuters request for comment on Thursday.
As part of the takeover, Broadcom is reviewing strategic options for two business units — Carbon Black and VMware End-User Computing — which it picked up last week when it closed its $69 billion acquisition of VMware. One analyst said the move likely means that VMware partners won’t be able to bundle the products together, a key selling point for many resellers.
To be transparent, the company reportedly told its VMware team it would let them know their employment status by mid-to-late October. However, due to the complexity of the process, it’s not impossible that notifications could be delayed past that deadline.
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Some VMware employees are fearful that the new parent company will shrink back office and sales operations and cut costs. They are right to be cautious — Broadcom has a history of reducing the size of acquired companies to maximize profitability within a few years.
Other concerns include how VMware will innovate under the giant umbrella of Broadcom and whether it will continue to provide a solid multi-cloud platform. For customers, it’s essential to have a plan that includes alternatives that can provide flexibility and limit their dependence on VMware. In addition, organizations should consider having contracts with multiple providers so that they can shift to another vendor if necessary. Until the uncertainty is resolved, ensuring your organization has the flexibility it needs to thrive is best.
