Cisco is undergoing another round of job cuts after facing decreasing demand and the need to cut costs. The US tech company has already experienced two significant layoffs this year, resulting in thousands of job losses. In response to the reduced demand and supply-chain issues in its core business of routers and switches, Cisco has diversified by acquiring cybersecurity firm Splunk for $28 billion in March to boost its subscription services.
Following the August layoffs, some employees expressed dissatisfaction, criticizing the company’s focus on layoffs rather than innovation and revenue growth. Despite these challenges, CEO Chuck Robbins stated that the company would finish the 2024 fiscal year strongly.
Cisco has clarified that the layoffs are not driven by a need to boost profitability, but rather part of a broader strategic realignment to focus on cybersecurity, cloud systems, and artificial intelligence (AI) products.
The company has allocated $1 billion to invest in AI startups as it aims to strengthen its focus on high-growth areas.