/// Cisco Plans to Cut 4,000 Jobs Starting This Quarter
Cisco Systems just said it plans to eliminate about 4,000 jobs starting next quarter. Word of the cuts came on a conference call with analysts along with the forward-looking guidance for the quarter ending in October. It said it expects to earn 50 cents to 52 cents on sales that will grow between five percent and seven percent. That’s about in line with the 51 cents the Street had expected. CFO Frank Calderoni said the company expects to take a charge of about $550 million on a pre-tax basis to cover the restructuring costs, and most of that will be done during the first quarter. Cisco is calling the move a “workforce rebalancing.” CEO John Chambers said on the same call that the company is seeing a slow and steady economic recovery, consistent with what was seen last quarter , but “not at the pace we want.” The cuts will amount to about five percent of Cisco’s overall workforce. It would be Cisco’s second round of layoffs this year. In March the company cut 500 . Last July it cut 1,300, about two percent of its headcount at the time. This cut is closer in scale to the big one Cisco made two years ago, when it said it would cut 6,500 people from its payroll . CEO John Chambers has repeatedly said that Cisco’s restructuring, which began in earnest in 2011, would be an ongoing process. It’s starting to look like layoff announcements are going to be a regular feature of the summer quarter. Cisco shares are down more than nine percent in after-hours trading on the heels of an earnings report that was weaker than expected . Sales were up about five percent in Cisco’s main business, Internet switching, which accounted for $3.8 billion or about 30 percent of sales.
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Cisco Plans to Cut 4,000 Jobs Starting This Quarter
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