Networking giant Cisco Systems has announced plans to lay off approximately 7% of its global workforce as part of a strategic shift towards high-growth areas such as artificial intelligence and cybersecurity. This move marks the company’s second major round of job cuts in 2024.
The 7% reduction equates to around 6,000 employees based on Cisco’s reported workforce of 84,900 as of July 2023. Earlier this year, the company laid off 4,000 workers in February.
Despite a 10% year-over-year decline in quarterly revenue to $13.64 billion, Cisco’s performance exceeded market expectations of $13.54 billion. The company stated that the restructuring plan aims to enable investments in key growth opportunities and drive efficiencies in its business. Cisco anticipates pre-tax charges of up to $1 billion related to the restructuring, with $700-800 million to be recognized in the first quarter of fiscal 2025.
CEO Chuck Robbins expressed confidence in Cisco’s future, highlighting a rebound in demand for the company’s networking equipment. Robbins mentioned that the inventory digestion phase is complete, and Cisco is now transitioning to a more normalized demand environment.
Amidst the layoffs, Cisco is focusing on capitalizing on emerging technologies by committing $1 billion to invest in AI startups and acquiring cybersecurity firm Splunk for $28 billion. As part of the restructuring, Cisco plans to merge its networking, security, and collaboration departments into a single organization.
The company has forecasted first-quarter revenue to be between $13.65 billion and $13.85 billion, surpassing analyst projections. Cisco’s strategic realignment underscores its commitment to innovation and adaptability in the ever-evolving tech landscape.
Frequently Asked Questions (FAQs) Related to the Above News
How many employees is Cisco Systems planning to lay off?
Cisco Systems is planning to lay off approximately 6,000 employees, which represents around 7% of its global workforce.
What are the key areas Cisco Systems is focusing on as part of its strategic shift?
Cisco Systems is focusing on high-growth areas such as artificial intelligence and cybersecurity.
How many rounds of layoffs has Cisco Systems announced in 2024?
Cisco Systems has announced two major rounds of job cuts in 2024.
What is the expected pre-tax charges related to the restructuring at Cisco Systems?
Cisco Systems anticipates pre-tax charges of up to $1 billion related to the restructuring, with $700-800 million to be recognized in the first quarter of fiscal 2025.
What is CEO Chuck Robbins' outlook on Cisco's future?
CEO Chuck Robbins expressed confidence in Cisco's future, highlighting a rebound in demand for the company's networking equipment and the transition to a more normalized demand environment.
How much is Cisco Systems committing to invest in AI startups?
Cisco Systems is committing $1 billion to invest in AI startups.
How much did Cisco Systems acquire cybersecurity firm Splunk for?
Cisco Systems acquired cybersecurity firm Splunk for $28 billion.
What departments are Cisco Systems planning to merge as part of the restructuring?
Cisco Systems plans to merge its networking, security, and collaboration departments into a single organization.
Please note that the FAQs provided on this page are based on the news article published. While we strive to provide accurate and up-to-date information, it is always recommended to consult relevant authorities or professionals before making any decisions or taking action based on the FAQs or the news article.
