Cisco to cut global workforce
Cisco Systems Inc. announced global workforce layoffs Wednesday as part of a drive to cut costs by $1 billion US.
The company said it would streamline its sales, service and engineering organizations over the next four months. It did not say whether any of its more than 1,000 employees in Canada would be cut.
The cuts come a month after it said it will shut its Flip video camera division, with the loss of 550 jobs.
The world's biggest networking equipment maker made the announcement as it reported better-than-expected adjusted earnings of 42 cents a share for the quarter ended April 30. Most analysts had expected 37 cents.
Net income fell 18 per cent to $1.8 billion, or 33 cents a share, compared with $2.2 billion, or 37 cents a share, a year earlier. Revenue rose by five per cent, to $10.9 billion.
"We have acknowledged our challenges," CEO John Chambers said in a release. "We know what we have to do. We have a clear game plan, and we are a company with a track record of market-shaping innovation. We thank our shareholders, employees, customers and partners as we transition to the next phase of Cisco."
Chambers didn't say how many jobs he's aiming to eliminate, mainly through an early retirement program. If the percentage is similar to the cut in expenses, it could amount to between 4,000 and 5,000 of the company's 73,400 employees.
Cisco estimated earnings per share in its current quarter would be 37 to 39 cents, less than analysts' expectations of 42 cents. Its shares fell in after-hours trading, losing 49 cents, or 2.7 per cent, to $17.29.
The firm sells routers and switches that direct traffic over the internet.
With files from The Associated Press