Cisco Lays Off Thousands of Employees

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Agu, Sel, 2024

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Cisco Lays Off Thousands of Employees

Morrissey Technology – Cisco will lay off thousands of employees as part of its shift in business direction to more promising sectors, such as cybersecurity and AI. This is the second wave of layoffs carried out by Cisco, and it is estimated that the number of employees laid off will be almost the same, or perhaps even higher than before, namely when Cisco laid off 4,000 employees last February.

Reported by Reuters, citing an anonymous source, these layoffs will be officially announced at the same time as Cisco’s Q4 2024 financial report. Cisco shares immediately fell 1% after news of these layoffs was first announced, and Cisco shares have fallen 9% since the beginning of 2024. As of July 2023, Cisco had 84,900 employees, but this number has not been reduced by employees who were laid off in February 2024.

Cisco, a manufacturer of high-end routers and switches, said its business was struggling due to slumping demand and problems in the supply chain. This means they are diversifying their business, one of which is by acquiring the cybersecurity company Splunk for USD 28 billion in March 2024. This acquisition is expected to reduce Cisco’s dependence on network equipment sales revenue and increase their subscription business. Then Cisco is also trying to expand its AI business by incorporating AI into its products. They also target to get revenue of USD 1 billion from AI products by 2025.

Last June they injected funds into various AI startups amounting to USD 1 billion, for example Cohere, Mistral AI, and Scale AI. They also said they had made 20 AI-related acquisitions and investments over the past few years. Based on the monitoring site Layoffs.fyi, 126 thousand people have been laid off from 393 technology companies during 2024. The latest news comes from Intel, which laid off 15% of its employees in early August, or around 17,500 employees.

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