Cisco says it’s cutting 5% of global workforce, amounting to over 4,000 jobs
This article touches on the recent layoff pattern of many big tech companies across the US. Cisco announced last week that it has plans to cut down on 5% of its global labor force to restructure its business. The 5% layoff would be eliminating 4,250 jobs from across all Cisco offices. These layoffs are in an effort to "downsize the company" They are facing a lot of financial issues as the company's shares, revenue, and net income are down from the last quarter. Their predictions for the quarter are also down around 6% as their revenue went from $12.79 billion down to $12.71 billion expected. The Cisco CEO and chairman, Chuck Robbins, has commented on these declines and says that after some guidance the company is "seeing a greater degree of caution and scrutiny of deals given the high level of uncertainty." Overall their demand is looking "sluggish" so by taking these proactive measures, they hope to be more conservative with their forecasting and look for a higher dividend payout in the next report.
I wonder how this will affect the rest of the world? Many indicators in America are still pointing to a very strong labor force and employment rate.
ReplyDeleteI am curious as to which specific jobs they cut down on. With such a large amount of employees, I am sure there are at least some jobs that have costs far exceeding their benefit. I am wondering why the cut certain jobs over others. Was it because an executive simply saw the positions as unneeded, or did they have productivity data that showed these employees were not contributing much to the company?
ReplyDeleteIt is interesting to think how the recent layoffs at Cisco indicative of the company's response to financial challenges and market uncertainty, and what strategies is Cisco implementing to address these issues and potentially improve its financial performance.
ReplyDeleteYou mention that other big tech companies are laying off their global workforces as well. I am curious to know if they were also looking to "downsize" or if the trend is occuring because if the sector they all occupy. It's hard to see that super companies like Apple and Microsoft would have the need to lay off their workforces.
ReplyDeleteI was unaware that 144 tech companies have laid off almost 35,000 workers this year. It is not surprising that sluggish demand will decrease revenue and as demand decreases the company would have to make decisions by either cutting costs or downsizing. The lack of revenue will have to be compensated somewhere like employee expenses, and it is unfortunate that so many people had to lose their jobs because of this.
ReplyDeleteOne question that I would have for Cisco is, is this lower workforce sustainable for them over time, or is this something they plan on reversing sometime in the future? It is also surprising to hear that a company of this size is having these kinds of troubles.
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