Cisco is planning to restructure its business, which will include laying off thousands of employees, as it seeks to focus on high-growth areas, according to three sources familiar with the matter.
The San Jose, California-based networking giant has a total of 84,900 employees in fiscal 2023, according to its website.
The company is still deciding the total number of employees who will be affected by the layoffs, one person said.
An announcement could come next week, as the company prepares for its earnings presentation on February 14.
In November 2022, Cisco announced during an earnings call a restructuring that affected approximately 5 percent of its workforce, resulting in $600 million in severance and other charges.
Cisco is planning to restructure its business, which will include laying off thousands of employees, as it looks to focus on high-growth areas, sources told Reuters.
Cisco declined to comment.
The move would come as technology companies, including telecoms makers Nokia and Ericsson, cut thousands of jobs last year in a bid to cut costs.
Several big tech companies like Amazon, Alphabet and Microsoft have implemented layoffs in recent weeks, continuing the trend.
Other technology and media companies, including eBay, TikTok and the Los Angeles Times, have recently announced layoffs.
Just this week, Snap, owner of the social media app Snapchat, announced it would cut 10 percent of its workforce.
Aside from technology and media, UPS, Macy’s and Levi’s also recently cut jobs.
But despite the high-profile job cuts, the number of Americans filing unemployment claims fell last week.
Claims for unemployment benefits fell by 9,000 to 218,000 during the week ending Feb. 3, the Labor Department reported Thursday.
Cisco CEO Chuck Robbins is seen above. The company is reportedly the latest tech company to consider layoffs, following recent cuts at Amazon, Alphabet and Microsoft.
Weekly unemployment claims are considered an approximation of the number of layoffs in the United States in a given week.
They have remained at extraordinarily low levels despite the US Federal Reserve’s efforts to cool the economy.
Cisco had cut its full-year revenue and profit forecasts in its previous earnings call, in a sign that demand for its networking equipment was slowing.
It had attributed the weakness to a slowdown in orders in the first quarter, saying that “customers are currently focused on installing and deploying products in their environments.”
In recent years, the company has grappled with supply chain issues and a post-pandemic slowdown in demand, which has accelerated its push into software offerings like cybersecurity.