Network leader Cisco is said to be preparing for a major overhaul, which might involve cutting thousands of jobs. This step is part of a plan to focus more on areas of the business that are growing faster.
According to one source, the number of employees who will be let go is still being determined.
Cisco might announce its restructuring plan, which could impact many of its employees, during a company earnings call scheduled for February 14. This date is seen as a potential deadline for the announcement.
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Cisco Faces More Workforce Reductions in 2024
As per Cisco's website, the company had 84,900 employees in mid-2023. This number came after the company let go of about 4,100 workers, affecting about 5% of its employees. This move resulted in $600 million in severance and related costs.
In January, Cisco continued its restructuring process by announcing the layoff of nearly 700 employees.
In July 2023, the company carried out a series of layoffs affecting various departments, including Webex, Cisco Application Centric Infrastructure, Cisco Collaboration, Cisco Data Center Services & Solutions, Cisco Experience Centers (CxC), Cisco Security Business Group (SBG), and Cisco Servers - Unified Computing System (UCS).
Cisco explained to Fierce Telecom that these layoffs were part of the "rebalancing effort" they announced in November. The company emphasized that the layoffs were not about reducing costs, as their total employee count remains similar to before the process started.
According to Cisco, this restructuring is focused on reallocating resources to meet better and surpass customer expectations in an evolving technological environment.
In its latest earnings call in November 2023, Cisco reduced its yearly revenue and profit forecasts. This revision, indicating a decrease in demand for its networking equipment, led to an 11 percent drop in its stock price.
Despite this downturn, Cisco reported a positive development in the same call: its collaboration sales had increased for the first time in a year. This growth changed from the previous four quarters, where collaboration sales had consistently declined.
Cisco has kept details private and has not made any official statements. However, there is a possibility that an announcement regarding their decision could come as soon as this week.
Cisco Focuses on Software and Cybersecurity
As part of its restructuring, Cisco anticipates intensifying its focus on software solutions, particularly cybersecurity. These areas are recognized for their higher growth potential.
At the recent Cisco Live event, Cisco introduced a new Webex app for the Apple Vision Pro. The app, now accessible on the App Store for visionOS, was highlighted by Jeetu Patel, Cisco's Executive Vice President and General Manager of Security and Collaboration.
Patel referred to the device as "one of the most consequential devices of our times" during the event's keynote speech. This app lets users participate in immersive meetings using Apple's spatial computing technology. With its release last Friday, February 2, Webex joined Microsoft Teams and Zoom in Vision Pro's app library.
Additionally, Cisco Live was the platform for launching a unique Identity Intelligence solution, part of the Cisco Security Cloud, augmented by new AI-powered security features. Simultaneously, the company announced that various AI Assistant features for Webex Suite and Contact Center customers are now generally available.
These features include automated meeting and vidcast summaries and automatic translation capabilities.
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