Cisco Cuts 5,500 Jobs as Networking Demand Normalizes

Cisco announced it would lay off approximately 5% of its workforce -- about 5,500 employees -- as enterprise customers digested a backlog of networking equipment orders and the company pivoted toward AI-driven networking and security.

Cisco Systems

February 2024

5,500 employees affected

Global

Why Did This Happen?

Customers who over-ordered during the supply-chain crisis were now working through excess inventory

Order backlog normalization led to sequential revenue declines for the first time in years

Strategic acquisition of Splunk for $28B required integration and role consolidation

Shift toward recurring-revenue software model demanded different skill sets across the organization

Impact Analysis

The layoffs affected sales, engineering, and operations teams across San Jose, Research Triangle Park, and global offices. Cisco took a $600M restructuring charge and redirected investment toward AI networking fabric, security analytics, and observability. The Splunk integration became the centerpiece of Cisco's enterprise AI security strategy.

Source: CNBCView original

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