Cisco is the latest healthy tech company to cut jobs with 4,000 layoffs
- Cisco is reducing its workforce by 5%, amounting to about 4,000 jobs.
- The layoffs are part of the company's plan to realign and invest in key priority areas.
Cisco is cutting 4,000 jobs in a move that will reduce its workforce by about 5%.
The IT hardware and software maker said the cuts, announced alongside its quarterly results on Wednesday, will result in costs of $800 million related to severance packages and benefits. It has about 85,000 staff.
Cisco's layoffs are part of plans to “realign the organization and enable further investment in key priority areas”, it said in a SEC filing.
CEO Chuck Robbins said in the earnings report: "We continue to align our investments to future growth opportunities. Our innovation sits at the center of an increasingly connected ecosystem and will play a critical role as our customers adopt AI and secure their organizations."
It's the latest example of a tech company cutting jobs despite being in good financial health. Cisco posted quarterly net profit of $2.6 billion, just $200 million lower than the same period last year.
Cisco is also strengthening its partnership with Nvidia to help companies build their own AI infrastructure. Last week Cisco said it would start selling Nvidia’s Ethernet solutions.
Nvidia CEO Jensen Huang said in a press release: “Companies everywhere are racing to transform their businesses with generative AI.”
He added that the partnership would help make it easier for companies to build infrastructure for AI, which he called “the most powerful technology force of our lifetime.”
Cisco’s job cuts follow mass layoffs hitting the tech industry in January. A total of 34,560 employees have been laid off across 144 tech firms so far this year, according to Layoffs.fyi data.
Cisco didn’t immediately respond to a request for comment from Business Insider, made outside normal working hours.
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