Cisco to Cut 6,500 Jobs, Plans to Refocus on Routing & Switching Business
SAN JOSE, Calif. — In an effort to trim more than $1 billion in annual costs and increase profit growth, Cisco Systems will cut 6,500 jobs or 9 percent of its workforce.
Roughly, 2,100 employees opted to take an early retirement package, while the remainder will be laid off, Bloomberg reports. Cisco expects to save $1.3 billion with $750 million to be recorded in the 2011 fourth quarter. The remainder will be booked in fiscal 2012.
The company also plans to sell its plant in Juarez, Mexico, to Foxconn Technology Group. Cisco acquired the site in 2006 from Scientific-Atlanta Inc. The company does not anticipate any job losses from the sale, although the 5,000 workers at the plant will be transferred to other positions.
With shares for the company dropping 24 percent this year, a rumor spread last week that the company would cut 10,000 jobs. Alkesh Shah, an analyst at Evercore Partners, stated that Cisco realized it needed to lower costs as the market becomes more competitive, Bloomberg reports.
The layoffs are part of an effort by Cisco’s CEO John Chambers to refocus the business on its main routing and switching business. Its rivals – Juniper Networks and Hewlett Packard – have experienced increases in market share, while Cisco has declined.
Security Is Our Business, Too
For professionals who recommend, buy and install all types of electronic security equipment, a free subscription to Security Sales & Integration is like having a consultant on call. You’ll find an ideal balance of technology and business coverage, with installation tips and techniques for products and updates on how to add sales to your bottom line.
A free subscription to the #1 resource for the residential and commercial security industry will prove to be invaluable. Subscribe today!
Recommended For You
Cloud security can present a paradox: companies love the flexibility and versatility of cloud security management, but are unsure if the cloud itself is secure enough to house their vitally important systems.
From processing power to lens selection to proper positioning, here are 13 tips to help shed light on proper installation of cameras in low-light conditions.