Red Hat back-office team to be Big and Blue whether they like it or not
(2025/09/08)
- Reference: 1757334671
- News link: https://www.theregister.co.uk/2025/09/08/red_hatters_to_be_big/
- Source link:
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.
[1]
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.
[2]
[3]
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 [4]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 [5]19,000 worldwide , with the bulk of those employed in the engineering, sales, and support divisions.
[6]
The team remaining at Red Hat will be part of the central Strategy & Operations group managed by [7]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.
[8]IBM return-to-office order hits finance, ops teams amid push to dump staff for AI
[9]IBM Consulting workers told management wants to 'more closely align pay, performance'
[10]IBM boss Arvind Krishna pockets 23% pay rise to $25M
[11]Red Hat sweetens the RHEL deal for biz devs – just don't put it in prod
One of those less enamored with the decision took to Reddit. "Culture has been dead for at least 1 year now," [12]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 [13]layoffs in April 2023 when it chopped 4 percent of its workforce, some 800 people. IBM acquired the business in 2019 for [14]$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 [15]$6.5 billion in 2024 and the subsidiary is considered strategic to Big Blue's cloud operations.
[16]
We have asked Red Hat to comment. ®
Get our [17]Tech Resources
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[4] https://www.theregister.com/2025/01/30/ibm_q4_2024/
[5] https://www.redhat.com/en/about/company-details
[6] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44aL79n02sOwwjdIpMmXYn_AAAABU&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[7] https://www.redhat.com/en/about/company/leadership/michael-ferris
[8] https://www.theregister.com/2025/02/12/ibm_return_to_office_mandate/
[9] https://www.theregister.com/2025/02/24/ibm_consulting/
[10] https://www.theregister.com/2025/03/14/ibm_arvind_kerching_pay/
[11] https://www.theregister.com/2025/07/10/rhel_business_developers/
[12] https://www.reddit.com/r/redhat/comments/1n7fcx8/people_finance_accounting_legal_plus_the_it_teams/
[13] https://www.theregister.com/2023/04/24/ibm_red_hat_layoffs/
[14] https://www.theregister.com/2018/10/28/ibm_redhat_acquisition/
[15] https://www.nextplatform.com/2024/10/24/ibms-red-hat-acquisition-will-pay-for-itself-by-early-next-year/
[16] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33aL79n02sOwwjdIpMmXYn_AAAABU&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[17] https://whitepapers.theregister.com/
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.
[1]
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.
[2]
[3]
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 [4]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 [5]19,000 worldwide , with the bulk of those employed in the engineering, sales, and support divisions.
[6]
The team remaining at Red Hat will be part of the central Strategy & Operations group managed by [7]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.
[8]IBM return-to-office order hits finance, ops teams amid push to dump staff for AI
[9]IBM Consulting workers told management wants to 'more closely align pay, performance'
[10]IBM boss Arvind Krishna pockets 23% pay rise to $25M
[11]Red Hat sweetens the RHEL deal for biz devs – just don't put it in prod
One of those less enamored with the decision took to Reddit. "Culture has been dead for at least 1 year now," [12]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 [13]layoffs in April 2023 when it chopped 4 percent of its workforce, some 800 people. IBM acquired the business in 2019 for [14]$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 [15]$6.5 billion in 2024 and the subsidiary is considered strategic to Big Blue's cloud operations.
[16]
We have asked Red Hat to comment. ®
Get our [17]Tech Resources
[1] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2aL79n02sOwwjdIpMmXYn_AAAABU&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
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[4] https://www.theregister.com/2025/01/30/ibm_q4_2024/
[5] https://www.redhat.com/en/about/company-details
[6] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44aL79n02sOwwjdIpMmXYn_AAAABU&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[7] https://www.redhat.com/en/about/company/leadership/michael-ferris
[8] https://www.theregister.com/2025/02/12/ibm_return_to_office_mandate/
[9] https://www.theregister.com/2025/02/24/ibm_consulting/
[10] https://www.theregister.com/2025/03/14/ibm_arvind_kerching_pay/
[11] https://www.theregister.com/2025/07/10/rhel_business_developers/
[12] https://www.reddit.com/r/redhat/comments/1n7fcx8/people_finance_accounting_legal_plus_the_it_teams/
[13] https://www.theregister.com/2023/04/24/ibm_red_hat_layoffs/
[14] https://www.theregister.com/2018/10/28/ibm_redhat_acquisition/
[15] https://www.nextplatform.com/2024/10/24/ibms-red-hat-acquisition-will-pay-for-itself-by-early-next-year/
[16] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33aL79n02sOwwjdIpMmXYn_AAAABU&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[17] https://whitepapers.theregister.com/
I remember a time...
DarkwavePunk
Back in my early years in IT I would yearn for a job at IBM. That feels like decades ago now. Probably because it is.
Re: I remember a time...
Anonymous Coward
I too yearned for a job at IBM and then I got one. Box ticked and I ran away as soon as an opportunity presented itself
It's necessary
Yet Another Anonymous coward
To maintain IBM's continued industry-leading redundancy rate, they need a continued supply of new staff to downsize
Doctor Syntax
"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."
Nevertheless the product remains reassuringly expensive for those manglements who need to tick the "Is product supported?" box or want somebody to sue if it all anything goes wrong.
williamyf
Suse and canonical (ubuntu) would like to enter that chat. I guess both tick those boxes and are less expensive than purple hat or oracle
tiago.pelicari
Compared to the Broadcom way, IBM’s slower pace of integration feels almost refreshing.
Legal, Finance and HR
Anonymous Coward
The core of IBM.
Once they can bill for licenses, sue for infringement and fire for age, the rest can take care if itself.
Blue Hat Linux
Ha ha. I remember hearing from one of our Red Hat reps that IBM wasn't going to take over their culture, and in fact they believed Red Hat was going to take over IBM culture.
It is to laugh.