Cisco has cut nearly 700 jobs in the United States
Cisco laid off a total of 673 workers as part of a "limited business restructuring" announced in November last year.
Reportedly, 371 workers have been fired from the company’s headquarters and 222 workers, which includes primarily engineers and technical employees, were asked to leave its Milpitas office.
The job cuts come after the company posted its largest quarterly revenue total in its history during the first fiscal quarter of 2023. While it is unclear whether Cisco will conduct more layoff rounds, it was reported last year that Cisco will lay off 5% of its workforce, or more than 4,000 employees.
In its first quarter earning report (Q1 2023), Cisco reported $13.6 billion in revenue, up 6 per cent year over year.
It is, however, unclear whether Cisco will conduct more layoff rounds.
Cisco is just one of many tech behemoths laying off employees as the industry experiences a downturn after the coronavirus pandemic and rising inflation. Companies including Meta, Amazon, and Twitter have laid off hundreds and thousands of employees in the last couple of months.
Cisco had said in a statement that "we didn't take this decision lightly, and we will offer those impacted by extensive support, including generous severance packages".
One such impacted employee posted that around 45 people from his team were fired. The post read, “Impacted by Cisco layoffs today. In our org infrastructure and cloud services, about 450 employees were impacted (sic).”
“It's (layoffs are) across all BUs,” the techie said. It is worth noting that the company had announced last month that it would downsize its workforce to cut down on costs amid the ongoing economic slowdown.
Another employee working in the product team of Cisco noted that employees have two options for the last working day, February or March. Employees choosing the February date as their last working day would get one month's pay extra.
The employee said, “The laid off employees get to choose if they want their last day in Feb or Mar. 6 months severance starts from today though. So if they leave on Feb, 4 more months of pay, and if they leave on Mar, 3 more months (sic).”
Another employee highlighted that the layoffs have been across business units and have not been limited to specific operations.
Rightsizing certain businesses: CEO
In December, Cisco chairman and CEO Chuck Robbins said the company would "be reluctant to go into a lot of detail here until we're able to talk to them.
I would say that what we're doing is rightsizing certain businesses," he said. "You can just assume that we're going to – we're not actually – there's nothing that's a lower priority, but we are rightsizing certain businesses," he told the analysts.
"Rebalancing" act, said CFO
Cisco chief financial officer Scott Herren described the job cuts as a "rebalancing" act. "Don't think of this as a headcount action that is motivated by cost savings. This really is a rebalancing. As we look across the board, there are areas that we would like to invest in more, Chuck just talked about them. Security, our move to platforms and more cloud-delivered products," Herren said during the company's earnings call.
Amazon, Vimeo layoffs
The development comes a few days after Amazon announced that it laid off 18,000 of its employees in the last two months. In a note to employees, company CEO Andy Jessy said, "Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so.
These changes will help us pursue our long-term opportunities with a stronger cost structure; however, I’m also optimistic that we’ll be inventive, resourceful, and scrappy in this time when we’re not hiring expansively and eliminating some roles," the CEO told the company employees.
Vimeo CEO Anjali Sud also announced that the company has decided to cut its workforce by 11% due to "uncertain economic environment.” This is the second round of job cuts in the company after it reduced the headcount by 6% in July last year.