Novell Targeting 10-Plus Percent of EMEA Employees for Layoffs
Jun 13, 2005, 20:00 (0 Talkback[s])
(Other stories by Brian Proffitt)
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By Brian Proffitt
While Novell has not commented on the possibility of upcoming
layoffs, sources have revealed layoff targets for Novell employees
in the company's Europe, Middle East, and Africa (EMEA)
Sources close to Novell and SUSE Linux have indicated that 180
employees will be let go in the EMEA division. Departments targeted
include mostly sales and partner divisions.
While it is not know exactly how many of these 180 employees
will come out of Novell's SUSE Linux division, one source expressed
that "less than half" of this total will come out of SUSE
The projected number of layoffs is small compared to Novell's
worldwide employee count, which according to Novell Press Relations
Manager Kevan Barney is approximately 5,900. The number of Novell
EMEA employees numbers around 1,300, which puts the projected
division-wide layoff percentage at 13.9 percent.
This is, based on other information related to Linux Today, not
a universal percentage. One Novell manager in Europe was apparently
asked to reduce staff by 25 percent. Managers are also working to
reduce employee numbers through some hiring freezes and
These layoffs, if they do occur, make sense when seen against
Novell's 2Q loss of US$16 million, which the Waltham,
Massachusetts-based company announced May 26. Novell's report
identified declining sales of their older Netware software business
coupled with just a six percent rise in sales on the Linux side of
the business as a significant contributor to their loss.
European sales figures were specifically targeted as a problem
area for Novell. But, given the company's positive public stance on
Linux as its future salvation, it is not surprising that the SUSE
division was spared some of the cuts.
In his conference call announcing the 2Q results last month,
Novell CEO Jack Messman was still very positive on Linux, citing
recent sales to the US Department of Health and Human Services and
several Fortune 500 companies, including Circuit City and
Toronto-Dominion Bank in Canada.
Novell has made it well known that their future depends on the
success of their Linux sales, and that this time of transition from
one business to another is going to be the roughest part of their