Cisco is planning to announce a reduction in its workforce, potentially impacting thousands of employees, reports Reuters.
This move marks the second wave of layoffs for the company in 2024, as it aims to shift its focus towards higher-growth areas such as cybersecurity and artificial intelligence (AI).
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According to sources, the exact number of job cuts could be similar to, or slightly exceed, the 4,000 positions that were eliminated in February 2024.
The job cut announcement is expected to coincide with Cisco’s fourth-quarter results, possibly as early as 15 August 2024.
As of July 2023, Cisco’s workforce stood at approximately 84,900 – this figure not accounting for the layoffs earlier in 2024.
Requests for comments from Cisco did not elicit a response, Reuters said.
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By GlobalDataCisco, known for its routers and switches that facilitate internet traffic, has faced challenges with demand and supply chain issues in its core business.
These challenges have prompted the company to diversify, including the $28bn acquisition of cybersecurity firm Splunk completed in March.
This strategic move aims to lessen Cisco’s dependence on equipment sales by enhancing its subscription services.
In its drive to integrate AI into its product suite, Cisco reaffirmed in May its goal to secure $1bn in AI product orders by 2025.
June saw the launch of a $1bn fund dedicated to AI startup investments, with companies such as Cohere, Mistral AI, and Scale AI on the list.
Cisco highlighted that it has completed 20 AI-centric acquisitions and investments in recent years.
The tech industry has witnessed widespread job cuts as companies seek to balance substantial AI investments with cost reductions.
Layoffs.fyi data shows that more than 130,000 individuals have been laid off from 397 tech firms since the start of 2024.
In a notable example, Intel reduced its workforce by more than 15%, equating to roughly 17,500 jobs, in an effort to revitalise its loss-making manufacturing division.
