Red Hat is cutting several hundred jobs as it looks to “compete in a new environment,” joining a number of technology firms that have recently announced job cuts in the face of growing economic uncertainty. The news also comes after parent company IBM announced its latest results that relied heavily on Red Hat’s financial clout.

In an email to employees, which was also shared on Red Hat’s official blog site, CEO Tim Hicks said the company would be cutting just under 4% of its workforce over the coming months. Red Hat claimed approximately 19,000 employees prior to the move, with the cuts impacting around 700 employees.

Hicks explained that the cuts would “focus on general and administrative (G&A) and similar roles across all functions,” but would bypass completely “roles directly selling to customers or building our products.” Notices were set to go out starting today and will work through the end of the second quarter.

“Like every company, Red Hat’s resources are finite and our investments, including our investments in talent, must be aligned with our strategy,” Hicks wrote in explaining the move.  “Over the past few quarters, each member of our corporate leadership team has considered what a best-in-class organization looks like for their function and articulated a vision for their organization over the next few years, including the talent and skills needed to execute that vision.”

As for its workforce strategy going forward, Hicks noted, “we must continue to sharpen our focus and do fewer things better. Our ways of operating must evolve — there will be a required change in the work we all do. We must be willing to engage and learn the intersections between our teams and to manage them more directly, with fewer layers of interface. This is not work we can delegate to others; instead, we must put our energy into simplifying our structure. This structural change needs to be accompanied by a cultural change as well: we must choose to work and prioritize differently, or we will simply recreate the challenges that got us here.”

The cuts come days after IBM reported positive first-quarter earnings that were driven by its Red Hat-focused hybrid-cloud business. IBM noted that its overall hybrid-cloud revenues increased 17% year over year, with Red Hat specific revenues increasing 21%.

IBM management touted “good performance” across the Red Hat portfolio, and that IBM gained share via Red Hat’s OpenShift Kubernetes orchestration platform and Red Hat Enterprise Linux (RHEL), which execs touted as the company’s “foundational hybrid cloud offerings.”

“I know it is hard to reconcile that we are a successful, growing company and still need to take these hard actions. At the core of this decision is the need to rebalance where we are investing to enable Red Hat’s future,” Hicks wrote this week on the job cuts. “Red Hat has a tremendous opportunity around open hybrid cloud with the evolution of public cloud and edge and in specific industries like telecommunications and automotive, but the market opportunities will not wait for us. What's become evident is that we must adapt and make this change to ensure we're able to invest in ways that will enable Red Hat to do this, including how we align budget and headcount.”

IBM earlier this year cut around 3,900 jobs, or 1.5% of its global workforce, in a move that cost the company around $300 million in severance pay outs during the first quarter. IBM’s management tied the cuts to the spinoff of managed infrastructure business that is now Kyndryl, IBM’s sale of its health care data analytics business and what IBM CFO Jim Kavanaugh said were “some external factors that we faced this past year that impacted our profit and cash,” including IBM’s decision to exit “a profitable business” in Russia and inflation in the U.S.

The latest job cuts continue what has been a sharp trend in the cloud space.

Amazon is cutting more than 27,000 positions companywide, including in its wildly profitable Amazon Web Services (AWS) business. SAP, Microsoft and Salesforce also have slashed jobs over the past several months.