IBM-owned subsidiary Red Hat is docking a bunch of its back-office staff, along with the techies that support them, into the mothership.
The migration – which some onlookers may be surprised didn’t happen sooner – is due to take effect from the start of 2026. Company insiders were told about the move on September 3.
According to a communication sent to employees, those in General & Administrative areas will join IBM, including the lion’s share of the people working in the HR, finance, accounting, and legal units at Red Hat.
A source told us the switch will be “implemented this year,” although in some countries “it might take longer due to legal constraints.” The leadership running those teams will remain within the Red Hat fold.
Some are nervous about the move, with tech companies – notably IBM – eliminating duplicated roles to consolidate back-office functions. In January – as has happened in recent years – IBM again forecast annual savings of $3.5 billion, partly through job cuts.
There is no public data on the size of the G&A population within Red Hat but the total workforce is understood to be about 19,000 worldwide, with the bulk of those employed in the engineering, sales, and support divisions.
The team remaining at Red Hat will be part of the central Strategy & Operations group managed by Mike Ferris. As such, engineering, product, sales, and marketing personnel will be unaffected. For now at least.
Not everyone is pleased to move across to IBM and some don’t seem too fazed, feeling they already work closely with their counterparts at Big Blue.
One of those less enamored with the decision took to Reddit. “Culture has been dead for at least 1 year now,” said commenter Purple_Afternoon 966. “The experience might be different depending on the department, but there is nothing left from the open culture praised. We have now micromanagement, decision making from middle management that clearly have no idea of what we do and how and trying to implement ideas that they read somewhere, with no context, data and not giving answer or addressing feedback.”
Red Hat made layoffs in April 2023 when it chopped 4 percent of its workforce, some 800 people. IBM acquired the business in 2019 for $34 billion and let it run on its own for years. Some staff may hope the back-office migrations aren’t a sign of things to come.
IBM said Red Hat generated an annual revenue run rate of around $6.5 billion in 2024 and the subsidiary is considered strategic to Big Blue’s cloud operations.
We have asked Red Hat to comment. ®