March 16 (Reuters) - Dell's total workforce declined by about 10%, or 11,000 employees, in fiscal 2026, it said on Monday, a sign that the AI server maker is limiting external hiring to reduce costs.

The company spent $569 million in severance payments in this period, compared with $693 million a year ago, its annual report showed. 

Dell had about 97,000 employees as of January 31, down from about 108,000 employees a year ago. Its workforce had declined by about 10% in fiscal 2025.

Silicon Valley employees have grown increasingly concerned about AI disruption in recent months as 60 tech companies have laid off more than 38,000 employees this year, according to Layoffs.fyi, a website tracking sector-wide job cuts.

Reuters reported on Friday that social media giant Meta was planning a sweeping layoff that could affect 20% or more of its workforce.

Dell, whose shares have risen over 24% so far this year, said last month that it expects revenue from its key AI-optimized servers business to double in fiscal year 2027.

In February, it announced a 20% hike in its cash dividend and an additional $10 billion for its share repurchase program.

(Reporting by Jaspreet Singh and Utkarsh Shetti in Bengaluru; Editing by Arun Koyyur)