The shake-up announced Wednesday means about 7 percent of Cisco’s roughly 78,000 workers will lose their jobs beginning this summer. No details were immediately given as to how many jobs Cisco plans on shedding in the Bay Area.
Advertisement
Cisco Systems, which briefly stalled its ritual annual layoffs last year, resumed it this year doubling the number it is sending home at 14,000, nearly 20% of its total workforce this year.
Saying it achieved year-on-year growth of 2 percent, Cisco reported the fourth quarter revenue of 12.6 billion US dollars, net income on a generally accepted accounting principles (GAAP) basis of 2.8 billion dollars, or 0.56 dollar per share, and non-GAAP net income of 3.2 billion dollars, or 0.63 dollar per share.
Revenue will be little changed from a year earlier, the company said Wednesday in a statement, indicating sales of about $12.7 billion.
Cisco says its layoffs will begin this quarter.
Chief Executive Chuck Robbins, who took over from John Chambers in July past year, has been steering the company toward more software and services businesses.
The layoffs were announced along with the company’s fourth quarter earnings report, which beat estimates.
Cisco saw 3% decline in its revenue to $3.45bn from its switching division in the third quarter, while routing business reported 5% drop in sales to $1.89bn.
On the other hand, Cisco, with about 73,000 employees as of April 30, refused to comment on the report. It laid off 6,000 employees in August 2014, 4,000 in 2013, 1,300 the year before that, and 6,500 in 2011.
“They need different skill sets for the software-defined future than they used to have”, said one source to CRN who asked not to be named. This is why Cisco is offering early retirement package plans to employees.
Results released in May showed that Robbins is making headway in rejiggering Cisco’s businesses.
Advertisement
“We believe we will transition more of our revenues to a software and subscription based model and accelerate our shift across our portfolio”, said Cisco CEO Chuck Robbins.
