Broadcom Layoffs: VMware Sees Mass Cuts Post-Merger

Less than a week after Broadcom finalized its $69 billion acquisition of VMware, the bloodletting has started.

WARN notices filed in Georgia and Colorado show 401 VMware employees impacted in Broadcom layoffs. The Georgia notification shows that 217 employees will eventually be let go, and the Colorado notification shows 184 people.

Broadcom's behemoth purchase of VMware finally cleared regulatory approval last week, ending a year-and-a-half of anticipation for VMware's employees, partners and customers. Now workers are getting clarity about their job security going forward.

With the acquisition closed, VMware employees are receiving emails about their future, or lack thereof, with the combined company.

According to one source, more than 2,000 people learned that they'll be losing their jobs.

Broadcom Layoffs: Number Could Rise Significantly

U.S. labor laws require companies to file a 60-day notice in states where they are conducting a plant closure or mass layoff. However, the overall number of job cuts certainly is much higher. One source inside VMware said Broadcom will likely lay off between 10,000 and 20,000 employees.

Many of these layoffs will occur gradually. VMware employees learned earlier this year that they faced three possible options: an offer for a Broadcom job, an immediate severance package or a transitional role set to expire within a year.

Related:‘Start of a New Era’: $61 Billion Broadcom-VMware Deal Closes

“A lot of people have this transitional situation where they've been told upfront, 'You've got three months, six months, nine months,’ or whatever. They're going to train their replacement," said one VMware employee, who was informed that their job will end in January.

In Atlanta, the first "date of separation" will occur on Jan. 26, followed by Feb. 2, March 1, April 26 and May 24. The layoffs at the Broomfield, Colorado, location will start and end on Jan. 26.

Cuts at the Georgia location touch numerouspositions, including technical staff, product marketing, network engineering and partner sales management, according to a document provided by VMware.

A letter sent from Broadcom to impacted employees said Broadcom had "identified go-forward roles that will be required within the combined company."

Mass cuts fit with Broadcom's goals to increase its profitability. Broadcom is seeking to reach $8.5 billion in operating EBITDA. Fitch Ratings notes that Broadcom currently sits at $5 billion in operating EBITDA.

As of press time, Broadcom had not responded to requests from Channel Futures to clarify the scale of the cuts.

Related:Broadcom-VMware: Partners Face ‘Too Many Unknowns’