Cisco plans to cut more than 4,000 jobs as growth comes to a grinding halt

Cisco plans to cut more than 4,000 jobs as growth comes to a grinding halt

Cisco Systems, the largest maker of networking equipment, plans to cut thousands of jobs after a slowdown in corporate tech spending wiped out its sales growth.

A restructuring plan will affect roughly 5% of Cisco’s workforce, the company said Wednesday. It had almost 85,000 employees as of last year, suggesting that the move will involve approximately 4,000 jobs. The restructuring will cost about $500 million, Cisco said.

The announcement accompanied a forecast that fell far short of what Wall Street was projecting, sending Cisco shares tumbling in late trading. Customers are worried about the state of the economy, prompting them to delay orders and rethink how much equipment they may need, Chief Executive Officer Chuck Robbins told analysts on a conference call.

“Customers are pushing things out and putting a bit more scrutiny on them,” he said.

Cisco joins many of the largest tech companies in scaling back. Nearly 35,000 job cuts have been announced in 2024, according to Layoffs.fyi, which has been tracking tech layoffs since the pandemic.

Cisco shares fell as much as 6.7% in late trading on the weak forecast. The shares, little changed so far in 2024, had closed at $50.28 in New York.

Sales will be $12.1 billion to $12.3 billion in the fiscal third quarter, which ends in April. That compares with an average analyst estimate of $13.1 billion. Excluding certain items, profit will be 84 cents to 86 cents a share, versus a prediction of 92 cents.

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