IBM's 1990s turnaround (1993-2002)
IBM nearly collapsed in the early 1990s, losing billions and cutting more than 100,000 jobs. New CEO Lou Gerstner bet on services and software instead of hardware, shrinking the company to survive.
IBM returned to profitability and became a services giant.
The company was much smaller and never recovered its hardware dominance.
Gerstner's playbook — cut hard, then pivot to what's growing — is the template many analysts see Lip-Bu Tan following, with AI and data center chips as the target.
