Cisco slashing up to 6000 jobs

The reorganisation will shift more resources into Cloud, software and security

Cisco Systems will cut as many as 6000 jobs over the next 12 months, saying it needs to shift resources to growing businesses such as cloud, software and security.

The move will be a reorganization rather than a net reduction, the company said. It needs to cut jobs because the product categories where it sees the strongest growth, such as security, require special skills, so it needs to make room for workers in those areas, it said.

"If we don't have the courage to change, if we don't lead the change, we will be left behind," chairman and CEO John Chambers said on a conference call.

Cisco has about 74,000 employees, so the cuts will affect about 8 per cent of its staff. It will take charges of about $US700 million for the cost of the reorganization, up to half of that in the current quarter, Chief Financial Officer, Frank Calderoni, said.

Cisco announced the move on a conference call to discuss its financial results for the quarter, the fourth of its fiscal year. Its revenue and profit were roughly flat compared with a year earlier, though Chambers said he's grown more optimistic over the past few months.

During the quarter, Cisco posted sharply higher sales of software products, up 29 per cent, and UCS (Unified Computing System) data-center gear, up 30 per cent. In addition, its customer base for the new Nexus 9000 switch line grew from 180 to 580 customers. The Nexus 9000 is at the heart of Cisco's SDN (software-defined networking) strategy.

However, the company's core businesses declined overall, with routing down 7 per cent and switching down 4 per cent.

Sales fell in most emerging markets, including China, Russia, Ukraine and many countries in the Middle East, a trend that Chambers blamed partly on economic and political upheavals. Cisco doesn't expect the picture to improve in emerging markets for several quarters and thinks things could get worse, he said.

The company's sales to service providers are also ailing, partly because of mergers and acquisitions that are reducing the number of potential customers, Chambers said.

Stephen Lawson covers mobile, storage and networking technologies for The IDG News Service. Follow Stephen on Twitter at @sdlawsonmedia. Stephen's e-mail address is stephen_lawson@idg.com

Join the Good Gear Guide newsletter!

Error: Please check your email address.

Tags business issuesCisco SystemspersonnelNetworkinglayoffsfinancial results

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Stephen Lawson

IDG News Service
Show Comments

Essentials

Lexar® JumpDrive® S57 USB 3.0 flash drive

Learn more >

Microsoft L5V-00027 Sculpt Ergonomic Keyboard Desktop

Learn more >

Mobile

Lexar® JumpDrive® S45 USB 3.0 flash drive 

Learn more >

Exec

Lexar® Professional 1800x microSDHC™/microSDXC™ UHS-II cards 

Learn more >

Audio-Technica ATH-ANC70 Noise Cancelling Headphones

Learn more >

Lexar® JumpDrive® C20c USB Type-C flash drive 

Learn more >

HD Pan/Tilt Wi-Fi Camera with Night Vision NC450

Learn more >

Budget

Back To Business Guide

Click for more ›

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Azadeh Williams

HP OfficeJet Pro 8730

A smarter way to print for busy small business owners, combining speedy printing with scanning and copying, making it easier to produce high quality documents and images at a touch of a button.

Andrew Grant

HP OfficeJet Pro 8730

I've had a multifunction printer in the office going on 10 years now. It was a neat bit of kit back in the day -- print, copy, scan, fax -- when printing over WiFi felt a bit like magic. It’s seen better days though and an upgrade’s well overdue. This HP OfficeJet Pro 8730 looks like it ticks all the same boxes: print, copy, scan, and fax. (Really? Does anyone fax anything any more? I guess it's good to know the facility’s there, just in case.) Printing over WiFi is more-or- less standard these days.

Ed Dawson

HP OfficeJet Pro 8730

As a freelance writer who is always on the go, I like my technology to be both efficient and effective so I can do my job well. The HP OfficeJet Pro 8730 Inkjet Printer ticks all the boxes in terms of form factor, performance and user interface.

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre x360

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga 910

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?