By firing 4,000 more people, Cisco will have cut 12,000 jobs in two years
Cisco stunned the tech world yesterday when it said it would be firing 4,000 employees, even though it met analysts expectations for the quarter and the year.
This isn’t the first layoff that Cisco announced this year. In March, a mere five months ago, Cisco said it was firing 500 people. Prior to this new round of 4,000 firings, Cisco had cut 8,000 jobs. So that’s 12,000 jobs gone in the two years since Cisco’s CEO John Chambers began his turnaround.
Cisco currently employs 74,135 employees worldwide. About 17,496 of those work in the company’s Bay Area headquarters, and most of those are at its sprawling San Jose, California campus.
Chambers didn’t say who would be targeted for the new round of cuts, though he put all of the company’s middle managers on notice.
“We just have too much in the middle of the organization,” he said in an earnings call with analysts.
He also has not said which business units will be hit, although he promised that “growth” units will be spared, specifically cloud, security, software, services, and video.
Christopher Young, senior vice president of Cisco’s Security Group also said in a letter filed with the SEC that Sourcefire employees will not be cut.
So that leaves employees in the Cisco’s bread-and-butter units like switching, routing, and wireless feeling nervous, as well as employees who work for the company’s “other” units like collaboration.
One former Cisco employee told Business Insider that Cisco could tell 5,000 to 7,000 people that their job is going away with the end goal of firing 4,000.
“Cisco’s standard is to give people two to four weeks to find another Cisco job and then lay them off,” this former employee said. “They do a good job of making sure there aren’t that many job openings so most people leave.”
For the fourth quarter, Cisco reported $2.27 billion in profit, or 42 cents a share, up from $1.92 billion, or 36 cents in the year-earlier quarter. When taking out unusual expenses, Cisco reported adjusted profit per share at 52 cents. Analysts were expecting 51 cents. Revenue was up 6% to $12.42 billion from $11.69 billion, in line with expectations.
We reached out to Cisco for comment, and will update if we hear back.