Cisco is set to initiate another round of job cuts, potentially impacting numbers similar to or slightly exceeding the 4,000 roles it reduced in February.
Sources indicate that the layoffs could be announced by Wednesday, coinciding with the company’s fourth-quarter results.
As of July 2023, Cisco employed approximately 84,900 people, not including those affected by the earlier layoffs. The company, which has not commented on these developments, saw its shares drop nearly 1% after initial reports of the upcoming cuts, with a year-to-date decline of over 9%.
Historically, Cisco has dominated the internet traffic management sector with its routers and switches but has faced challenges such as tepid demand and supply chain issues. These factors have driven the company to diversify, highlighted by its $28-billion acquisition of cybersecurity company Splunk in March. This move aims to bolster its subscription services, reducing dependency on hardware sales.
Furthermore, Cisco is enhancing its portfolio with AI integrations, targeting $1 billion in AI product orders by 2025. In June, it announced a $1-billion fund to invest in AI startups, having made 20 AI-related acquisitions and investments in recent years.
These layoffs reflect broader cost-cutting trends in the tech industry, which has seen over 126,000 job cuts across 393 companies since the beginning of the year. Intel, for example, recently reduced its workforce by over 15%, eliminating about 17,500 positions to address its struggling manufacturing operations.
