Thousands of jobs at risk at Cisco
A second round of layoffs at Cisco will reportedly occur this year, affecting thousands of employees, as the US company is focusing on higher-growth sectors like AI and cybersecurity.
Updated; August 14, 2024 11:45 PM
People familiar with the matter told Reuters that the number of impacted employees may be comparable to, or slightly higher than, the 4,000 employees that Cisco let go in February.
Cisco has not responded to Reuters request for a comment on the information.
According to their annual report, as of July 2023, Cisco employed about 84,900 people. That number does not include the layoffs that occurred in February.
In the company's fourth quarter and fiscal year 2024 earnings report, Cisco announced a restructuring plan. According to the company, the plan will allow it to invest in key growth opportunities and drive more efficiencies in its business.
In connection with this restructuring plan, Cisco currently estimates that it will recognise pre-tax charges of up to USD 1 billion consisting of severance and other one-time termination benefits, and other costs. Cisco expects to recognize approximately USD 700 million to USD 800 million of these charges in the first quarter of fiscal 2025 with the remaining amount expected to be recognised during the rest of the fiscal year.
According to Reuters, Cisco will reduce its global workforce by 7% as it shifts focus on high-growth areas.
Cisco reported revenues of USD 13.6 billion during its Q4 2024, above the high end of its guidance range but still a decrease of 10% YoY. Full-year revenues amounted to USD 53.8 billion, down 6% compared to 2023.
"As we look to build on our performance, we remain laser focused on growth and consistent execution as we invest to win in AI, cloud and cybersecurity, while maintaining capital returns," Scott Herren, CFO of Cisco, says in the report
