Trends
Cisco lays off thousands as it shifts focus to AI, cybersecurity
Cisco plans to lay off 7% of its workforce, in a shift to technology. Fiscal fourth-quarter earnings fell, but shares rose.
Headline
Cisco plans to lay off 7% of its workforce, in a shift to technology. Fiscal fourth-quarter earnings fell, but shares rose.
Context
OUR TAKE Layoffs are both a challenge and an opportunity for Cisco. It may affect core functions and business continuity, lower the morale of current employees, and raise public opinion issues. At the same time, however, it can help reduce costs, improve efficiencies, facilitate focus on the core business, and provide opportunities for organisational restructuring and innovation. Cisco needs to ensure that the downsizing process is fair and equitable, and that it is used to drive long-term stability. — Iydia Ding, BTW reporter Cisco plans to lay off 7 per cent of its workforce, or about 5,900 people, in the company’s second round of job cuts this year as it shifts its focus to technology in fast-growing areas such as AI and cybersecurity . Cisco’s shares rose despite a drop in earnings in the company’s fiscal fourth quarter, with earnings and revenue expected to grow modestly in the current fiscal quarter.
Evidence
Pending intelligence enrichment.
Analysis
The San Jose, California-based company did not specify the number of layoffs. In February, Cisco announced it would lay off about 4,000 workers. The networking equipment maker also said in June that as of July 2023, it had 84,900 employees. Based on that figure, the number of layoffs would be about 5,900. It will invest $1 billion in tech startups such as Cohere, Mistral and Scale to develop reliable AI products. The company also recently announced a partnership with Nvidia to develop infrastructure for AI systems. Also read: Intel to lay off 15,000 employees amid financial challenges Also read: Google lays off at least 100 jobs across its cloud unit
Key Points
- Cisco plans to lay off 7% of its workforce, or about 5,900 people, to move into AI and cybersecurity.
- Despite a drop in fiscal fourth-quarter earnings, the stock is up, and earnings and revenue are expected to grow modestly in the current quarter.
Actions
Pending intelligence enrichment.
