Cisco has unveiled plans for significant workforce reductions, marking a strategic move in its restructuring efforts. The company, headquartered in Silicon Valley, revealed that approximately 5% of its global workforce will be impacted by the layoffs, according to its latest quarterly earnings report.
With nearly 85,000 employees as of the close of last year, as stated on its website, Cisco's decision reflects a deliberate adjustment in response to evolving market dynamics.
Industry analysts suggest that such workforce adjustments might become commonplace in Silicon Valley as the sector increasingly pivots towards AI technologies. While these layoffs are notable, they do not match the scale witnessed in late 2022 and early 2023 when numerous tech firms shed hundreds of thousands of jobs, a consequence of the rapid expansion during the pandemic.
In a significant move late last year, Cisco embarked on its largest acquisition to date, agreeing to purchase cybersecurity firm Splunk in a deal valued at $28 billion. This strategic acquisition, expected to be completed by April 30, underscores the growing importance of cybersecurity within the tech industry.
CEO Chuck Robbins emphasized the company's commitment to aligning investments with future growth opportunities, particularly in innovation to support customers in adopting artificial intelligence and bolstering organizational security.