Cisco Systems Announces 5,500 Layoffs

Cisco Systems announced at the closure of Wall Street a new restructuring plan that will affect 5,500 of its employees. Layoffs will thus affect 7% of the global workforce. The technology company specified the reasons for the adjustment during the presentation of its results for the year-end. The leading network services firm scored a profit of $ 10.7 billion, 20% more than a year ago.

The adjustment is less severe than expected, following information that anticipated the elimination of 14,000 jobs. That would have meant a 20% cut in the workforce. In any case, this new restructuring adds to the 6,000 jobs that Cisco Systems already cut in 2014 and to the 4,000 jobs that were announced a year earlier to adapt to the new reality of the world of computing.

Chuck Robbins, its CEO, justifies the adjustment as necessary to reduce the cost base and allocate savings to investments to the development of security systems, data management centers, and the Internet of things. The executive points out that they are the areas of future growth, where he rivals Amazon, Microsoft, Oracle, IBM, Jupiter, or HP. Its revenues stagnated at 49,200 million during the last fiscal year.

Robbins took over the company a year ago. He recently acquired Jasper for $ 1.4 billion and established a business alliance with Apple for the connection of wireless electronic devices. The template set is in line with those announced by Microsoft or HP. The technology sector broke off this year from about 69,000 employees, counting on those announced by Cisco Systems. It is an increase of 71% in one year.

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Cisco Systems Will Reduce Its Global Workforce By More Than 8%

Cisco Systems is the last great technology to present results on Wall Street. The accounts of the company run by John Chambers show that there are improvements in its sector, despite the fact that the turnover of the manufacturer of the system fell again. To accelerate the adjustment, it now announces that it will eliminate some 6,000 more jobs, which is equivalent to more than 8% of the global workforce.

The results are year-end closing. It reduced the profit to 7.9 billion dollars (5.900 million euros) in the year, which is equivalent to a drop of 21% when compared to the year 2013. In the fourth quarter, however, the net gain stagnated in the 2,200 million dollars. On the income side, they fell 3% in the year, to 47.1 billion, and remained at 12.4 billion in the quarter.

Its main problem is the low demand for its network systems in some emerging countries such as China, Brazil, Russia, India, and Mexico. Despite this, Chambers talks about things starting to get better. The results, in fact, exceed what Wall Street expected. So far this year, its shares appreciated 20%. Like HP and IBM, now your bet is data management.

The company already announced last year the dismissal of 4,000 employees, anticipating a negative cycle in the industry. Then it affected 5% of the workforce. Now, however, it seems the worst of the bump happened. That is why the new adjustment, its managers indicate, will be “limited” and will materialize in loads of up to 350 million in the next quarter.…

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