Cisco has announced a significant reduction in its global workforce, with plans to cut approximately 7% of its employees, according to the US Securities and Exchange Commission (SEC).
This move marks Cisco’s second round of layoffs within the year; the company had previously let go of nearly 4,000 employees in February.
"Cisco announced a restructuring plan to allow it to invest in key growth opportunities and drive more efficiencies in its business," the company said.
The company's decision to implement these layoffs is part of a broader restructuring initiative aimed at reallocating resources to key growth areas and enhancing operational efficiency. Cisco has stated that this restructuring will affect about 7% of its total workforce.
The firm is targeting reducing its expenses by $1 billion through these job cuts and other cost-saving measures. The financial impact of these layoffs is anticipated to be substantial, with Cisco projecting that it will incur between $700 million and $800 million in associated charges during the first quarter of fiscal 2025.
The remainder of the costs is expected to be recognized over the course of the fiscal year.
In June, Cisco committed $1 billion to invest in artificial intelligence startups such as Cohere, Mistral, and Scale, aiming to foster the development of advanced AI solutions.
Additionally, Cisco has partnered with Nvidia to build state-of-the-art infrastructure for AI systems and has broadened its focus to include enhanced cybersecurity measures.
The tech sector overall has been experiencing a wave of layoffs in 2024. Major companies, including Intel, have announced significant job cuts, with Intel reducing its workforce by 15,000 employees.
Other leading tech firms, such as Microsoft, Amazon, and Google, have also made notable reductions in their staff numbers. This trend reflects a broader pattern of workforce downsizing across the industry as companies adjust to changing economic conditions and strategic priorities.
In 2024, several major companies will have implemented significant layoffs. Microsoft reduced its workforce by approximately 3,000 employees, while Reliance let go of 42,000, mostly affecting contract and part-time workers.
Paytm cut around 3,500 jobs. Unacademy, after recently reducing its staff by 250, announced that no appraisals would be given this year.
Among the 32 companies that have collectively dismissed many employees are prominent names like Byju’s, Ola, Swiggy, Unacademy, Cult.fit, and Simpl.
