Cisco Layoffs: Tech Firm To Cut Thousands More Jobs This Year, Says Report

According to the company's annual filing, as of July 2023, it employed approximately 84,900 individuals. This figure does not include the workforce reductions announced in February, as per the report

Cisco is reportedly carrying out a second wave of layoffs this year, potentially affecting thousands of employees, as the US networking equipment company refocuses on high-growth sectors like cybersecurity and AI, according to a Reuters report citing sources.

The new round of job cuts could match or slightly exceed the 4,000 employees laid off in February. The announcement is expected to coincide with the company’s fourth-quarter results, possibly as early as Wednesday, said the sources in the report.

According to the company's annual filing, as of July 2023, Cisco employed approximately 84,900 individuals. This figure does not include the workforce reductions announced in February, as per the report.

Cisco, the leading manufacturer of routers and switches that manage internet traffic, has been facing challenges with weak demand and ongoing supply-chain issues within its core business areas.

These challenges have prompted the company to diversify its operations, exemplified by its $28-billion acquisition of cybersecurity firm Splunk, which was finalised in March. This strategic move is expected to lessen the company's dependence on one-time equipment sales by enhancing its subscription-based business.

The company has been actively working to integrate artificial intelligence (AI) products into its portfolio. In May this year, it reaffirmed its ambitious goal of securing $1 billion in AI product orders by 2025. 

In June, the company launched a $1-billion fund specifically designed to invest in AI startups, including notable names such as Cohere, Mistral AI, and Scale AI. At that time, the company also highlighted that it had made 20 acquisitions and investments focused on AI over the past several years. This ongoing commitment shows the company’s strategic push to strengthen its presence in the rapidly growing AI sector.

The upcoming layoffs are part of a broader trend in the tech industry, where companies have been implementing cost-cutting measures to balance substantial investments in AI. Since the beginning of the year, more than 126,000 employees have been laid off across 393 tech companies, according to data from the tracking website Layoffs.fyi.