IBM is latest U.S. tech giant to pull back from China

• IBM will shut down its research and development department in China, impacting about 1,000 jobs, multiple outlets reported Monday.
• The Chinese government has encouraged domestic companies to overtake and push out U.S. tech dominance out of the country in a bid for self-sufficiency in the sector, the Wall Street Journal reported earlier this year.

State of play: IBM has faced mounting competition in China in recent years, IBM executive Jack Hergenrother told employees virtually Monday, per the Journal.

• IBM reportedly plans to move its R&D operations to other overseas facilities.
• According to the company's 2023 annual report released earlier this year, the company saw its revenue in China drop 19.6% last year.

What they're saying: "IBM adapts its operations as needed to best serve our clients, and these changes will not impact our ability to support clients across Greater China region," an IBM spokesperson told Axios in a statement Monday.

The big picture: IBM is not the only American tech company to pull back from China this year.

• In May, Microsoft asked hundreds of its employees in China to consider relocating to another country as the company looked to reduce its cloud-computing and AI-research operations in China, the Wall Street Journal reported.
• U.S. venture capital firms have also begun pulling back from investing in Chinese start-ups, per the New York Times.

Go deeper: Tech giants caught between escalating U.S.-China tensions

Editor's note: This story has been updated with a statement from an IBM spokesperson.