 "Cisco’s dramatic layoffs of 5,600 employees highlight a tumultuous industry shift towards AI and restructuring for future growth.")
Cisco, a major US technology company, has announced significant job cuts, laying off around 5,600 employees, which is about 7 percent of its workforce. This comes as part of its strategy to manage costs amid decreasing demand, following earlier layoffs of 4,000 workers earlier in the year. The company is shifting its focus towards investments in artificial intelligence (AI) and cybersecurity, committing $1 billion to AI startups and acquiring the cybersecurity firm Splunk for $28 billion. CEO Chuck Robbins remains optimistic about a rebound in demand for networking products, despite the job reductions. The restructuring aims to position Cisco for future growth and adaptation to changing technology trends.
Cisco, one of the largest technology companies in the United States, has announced a significant layoff of approximately 5,600 employees. This move marks the company’s second major job cut this year, following a previous reduction of 4,000 workers back in February. According to a report from The Times of India, these layoffs represent about 7 percent of Cisco’s total workforce, which is estimated at around 85,000 employees.
The decision to cut jobs comes as Cisco aims to manage costs amidst declining demand for its products. Despite these layoffs, the company is pivoting towards investments in high-growth sectors, particularly artificial intelligence (AI) and cybersecurity. Cisco has allocated $1 billion to support AI startups and made a notable acquisition of cybersecurity firm Splunk for $28 billion.
As uncertainty looms over which specific teams might be affected by these layoffs, Cisco is expected to provide more detailed information by mid-September. This trend of job cuts is not isolated to Cisco; it mirrors a broader pattern within the tech industry, where many companies are making reductions to combat economic pressures. Notably, in 2024 alone, over 136,000 tech employees across various companies have faced layoffs.
Despite the challenges, Cisco’s CEO, Chuck Robbins, maintains a positive outlook, anticipating a recovery in demand for networking products. He highlighted that inventory adjustments have been completed and the company is on track to a more stable demand environment. This announcement aligns with Cisco’s overall strong financial performance in 2024, reporting nearly $54 billion in revenue.
Interestingly, while the company is cutting jobs, Robbins’ total compensation for 2023 was reported to be nearly $32 million. This restructuring is part of Cisco’s strategy to realign its resources and focus on emerging technologies for long-term growth.
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Last Updated: September 19, 2024 | 7:04 PM IST
Reading Time: 2 minutes
What is happening at Cisco?
Cisco is laying off 5,600 employees as part of a restructuring plan to focus more on artificial intelligence and technology growth.
Why are they laying off employees?
The layoffs are part of a strategy to streamline operations and invest more in AI development and growth areas in the tech industry.
How many jobs will be affected?
A total of 5,600 jobs will be cut from the company’s workforce.
When will the layoffs take place?
The layoffs are expected to happen throughout early 2024, though specific dates may vary.
Is Cisco planning to hire again in the future?
While Cisco is focusing on AI and growth, it is possible they may hire in the future, depending on how the business evolves.
