Cisco to cut thousands of jobs as it seeks to focus on high growth areas: Sources

By Utkarsh Shetti and Supantha Mukherjee

(Reuters) – Networking giant Cisco plans to restructure its business, which will involve laying off thousands of employees, to focus on high-growth areas, according to three sources familiar with the matter.

The San Jose, Calif.-based company had a total of 84,900 employees for fiscal 2023, according to its website.

The company is still deciding the total number of employees who will be affected by the layoffs, one person said.

An announcement could come as soon as next week, as the company prepares to report results on February 14.

In November 2022, Cisco announced during an earnings conference call a restructuring that affected approximately 5% of its workforce, resulting in $600 million in severance and other charges.

Cisco declined to comment.

The move would come at a time when technology companies, including telecoms makers Nokia and Ericsson, have cut thousands of jobs last year in a bid to cut costs.

Several large technology companies such as Amazon, Alphabet and Microsoft have made layoffs in recent weeks.

Cisco lowered its full-year revenue and profit forecasts during its previous conference call, a sign of slowing demand for its networking equipment.

The company had blamed the slowdown in orders in the first quarter for the weakness, saying “customers are currently focused on installing and implementing products into their environment.”

The company has struggled in recent years with supply chain issues and a post-pandemic slowdown in demand, accelerating its move into software offerings such as cybersecurity.

(Reporting by Utkarsh Shetti in Bangalore and Supantha Mukherjee in Stockholm; editing by Chris Reese)

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