Cisco layoff numbers high, but not as high as rumored
Reports last week had job cuts reaching as high as 10,000; Cisco today confirms 6500 plus another 5000 from set-top plant sell-off
Cisco has been preparing to turn its networking battleship in a new direction for months. Today, it provided details of its restructuring plans (Briefing Room: Cisco Announces Additional Detail on Comprehensive Action Plan), including 6500 job cuts, or about 9% of its work force.
Cisco said it will take a one-time charge of $1.3 billion to cover the restructuring costs. In addition to the layoffs, 2100 of which will come via voluntary early retirement, Cisco is selling off a set-top box manufacturing facility to Foxconn Technology, slashing another 5000 employees.
Last week, Bloomberg reported Cisco planned to cut up to 10,000 jobs (not counting the Foxconn sell-off), so today’s numbers come in below that high estimate – making last week’s leak and this week’s reality a good-news/bad-news story for Cisco’s nervous workforce. Laid off workers will be notified in early August, Cisco said.
The overall reduction to Cisco’s head count comes in at 11,500, leaving it with about 78,000 employees.
Cisco is recovering from the economic slowdown as well as missteps into markets outside its core networking and router business – perhaps most noticeably its foray into the consumer market via its Flip video acquisition, which it shuttered earlier this year (CP: Cisco faces pressure to jilt consumers, home in on enterprise).
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