Cisco Cuts Deep: Thousands of Jobs Axed

Cisco Systems, the tech giant known for its networking equipment, has announced a major restructuring plan that will result in the loss of thousands of jobs worldwide. The company, which currently employs around 84,900 people globally, revealed that it will be cutting approximately 5% of its workforce, which equates to more than 4,000 employees.

In its second-quarter earnings report, Cisco stated, "On February 14, 2024, Cisco announced a restructuring plan in order to realign the organization and enable further investment in key priority areas. This restructuring plan will impact approximately 5 percent of Cisco's global workforce." The company also mentioned that it expects to incur pre-tax charges of around $800 million related to severance and other one-time termination benefits, as well as other costs associated with the restructuring.

The decision to cut thousands of jobs comes as Cisco grapples with a slowdown in corporate tech spending, which has significantly impacted its sales growth. In addition to the job losses, the company also lowered its annual revenue target for fiscal year 2024, citing weak demand and a tough economic environment. CEO Chuck Robbins acknowledged the challenges, stating, "We continue to see weak demand with our telco and cable service provider customers."

Cisco's move to streamline its workforce is part of a broader trend in the tech industry, as companies seek to reduce costs and realign their priorities. In recent months, several major tech firms, including Alphabet, Amazon, eBay, Microsoft, Salesforce, and TikTok, have announced fresh rounds of layoffs on top of the thousands of jobs already cut in 2023 and 2022. As Cisco shifts its focus to high-growth areas such as cybersecurity and artificial intelligence, the company hopes to emerge stronger and more competitive in the rapidly evolving tech landscape.