Cisco to cut 6,500 jobs in cost-cutting blitz
- — 19 July, 2011 07:07
Cisco Systems will cut about 6,500 jobs as part of an effort to focus its business and reduce operating expenses by about US$1 billion per year, the company announced on Monday.
The layoffs will eliminate about 9 percent of Cisco's regular, full-time workforce. In the ranks of vice president and above, Cisco said it will cut 15 percent of employees.
The company will incur about $1.3 billion in one-time costs for the layoffs, from items such as severance and termination benefits. Those costs will be incurred over several upcoming quarters.
Affected employees in the U.S., Canada and some other countries will be notified in the first week of August. Notifications will occur later in other areas, in accordance with local laws, the company said.
Also on Monday, Cisco announced it will transfer a set-top-box manufacturing facility in Mexico to Taiwan-based contract manufacturer Foxconn. No jobs will be lost in that transaction, but about 5,000 Cisco employees will be transferred to Foxconn.
Cisco is taking drastic efforts to cut costs and return its focus to its core routing and switching businesses after posting disappointing results and watching its stock fall over the past several quarters.