Cisco announces the elimination of several thousand positions

The Californian tech giant Cisco announced on Wednesday February 14 that it would eliminate several thousand positions as part of a restructuring plan. Some 5% of the firm's employees will be affected by this plan globally, it said when announcing its quarterly results. Cisco ended last year with nearly 85,000 employees according to its website.

Layoffs and job cuts in tech could become the norm as Silicon Valley attempts to implement the artificial intelligence (AI) revolution, according to industry experts. These recent announcements, however, are not on the same scale as those at the end of 2022 and the beginning of 2023, when tech companies had cut hundreds of thousands of positions - a boomerang effect of frantic hiring during the pandemic.

Cisco reached an agreement last year to acquire cybersecurity firm Splunk for $28 billion, the largest in its history. The California-based company reported revenue of $12.8 billion in the quarter that ended at the end of January, down 6% from the same period last year. It also reported a profit of $2.6 billion, about 5% less than the same quarter last year.

“We continue to align our investments with future growth opportunities,” Cisco CEO Chuck Robbins said in the earnings release. “Our innovation sits at the center of an increasingly connected ecosystem and will play a critical role as our customers adopt AI and secure their organizations.”

Cisco shares lost more than 5% to $47.65 in trading after the close and announcement of results.