Cisco, an IT company specializing in networking hardware and the cloud, announced on February 14 that it would reduce its workforce by 5%, as part of a restructuring plan. An announcement made during the publication of the multinational's quarterly results. According to its latest annual report, Cisco employs approximately 85,000 people, which means that 4,250 positions would be affected by the layoff plan.
The networking hardware maker has announced that it wants to focus on “key priority areas”like artificial intelligence. “We continue to align our investments with future growth opportunities, said Chuck Robbins, CEO of Cisco, in the company's earnings release. Our innovation sits at the center of an increasingly connected ecosystem and will play a critical role as our customers embrace artificial intelligence and secure their organizations.”
Advertisement
Financial results at half mast
When announcing its financial results for the quarter, Cisco showed a 6% drop in revenue, to $12.8 billion. Its profit amounted to 2.6 billion, or 5% less than in the same quarter last year. Cisco shares fell as much as 9% in trading.
The layoffs will begin this year, and are expected to continue into next year. The positions and countries concerned have not been specified. The company added that severance and severance pay would cost it $800 million. Already in September 2022, Cisco announced a $600 million restructuring plan leading to job cuts.
In September 2023, Cisco moved into artificial intelligence, announcing the acquisition of machine learning and cybersecurity company Splunk. A transaction valued at $28 billion, its largest acquisition. It then declared that it wanted to reach one billion dollars in orders linked to artificial intelligence by 2025.
Advertisement
This layoff comes in a difficult context for tech companies, with mass layoffs since the start of the year. Amazon, Paypal, Google and even eBay… In total, 144 companies in the sector have laid off nearly 35,000 employees in 2024.
Selected for you