IBM China Investment Company Limited (IBMV) and its subsidiaries shut down on March 1, impacting over 1,800 R&D and testing staff in Beijing, Shanghai, Dalian, and other sites. IBM's Beijing headquarters is now being dismantled, closing a chapter on nearly 40 years of R&D in China for the erstwhile tech giant, as reported by sources including Sina and Jiemian.
Founded in 1992, IBMV led IBM's R&D initiatives in China. In August 2024, IBM unexpectedly announced it would downsize its R&D department in China, affecting over 1,600 employees. Speculation arose among Chinese netizens that this move was linked to Arvind Krishna, IBM's Indian-born CEO. Recently, staff in Beijing, Shanghai, and Dalian were informed in an online meeting that their roles would be relocated overseas.
Following the establishment of diplomatic relations between China and the US in 1979, IBM entered China, capitalizing on the economic boom from China's reform and opening-up policies.
In 1992, IBM set up a wholly-owned subsidiary in China, making a profit in its first year primarily through its mainframe business. Over time, IBM shifted its focus from hardware manufacturing to becoming a full-service software company. At its height, IBM's software sales exceeded those of Microsoft and Oracle.
However, after 2023, escalating US-China tensions led to declining revenues, prompting IBM's complete withdrawal from R&D in China.
There have been signs that IBM might exit China, such as reports from local employees about decreasing business volume. In 2023, some project staff were reassigned, with operations shifting to India and Southeast Asia.
Article edited by Jack Wu
