Cisco continues jobs cull
Networking giant announces plans to cut a further 15 percent of its workforce in the Americas.
Cisco is to cut a further 15 per cent of its workforce, the networking giant announced after the markets closed yesterday.
The reductions will largely affect the company's operations in the Americas, with a big portion of the 6,500 job cuts in the US and Canada. Of these, Cisco said 2,100 would go through early retirement.
And the positions of some 15 per cent of its executives at vice president level and higher were said to be at risk.
Another 5,000 jobs will be transferred to contract motherboard manufacturer Foxconn in the first three months of the 2012 fiscal year through its acquisition of a Cisco set-top box manufacturing plant in Juarez, Mexico.
"While this action is expected to create improvements to Cisco's long-term cost structure, the strategic intent for this action is to simplify business operations," Cisco said in a statement.
It framed the announcements as part of Cisco's ongoing efforts to slash $1 billion (621 million) worth of costs out of its operations.
The vendor did not indicate what impact these latest cuts would have on reaching its target savings.
It expects the reductions to incur about $750m (465.5m) in fourth-quarter 2011 fiscal year charges, $500m (310m) of which is earmarked to fund the early retirement programme.
Employees set for the chop in the US and Canada will be notified in the first week in August, while Cisco said those affected in other countries will find out later, in line with local laws and regulations.
These layoffs are the latest in rationalisation goals set by the networking IT giant in 2009 to turn its ailing financial fortunes around.
Cisco chief executive (CEO) John Chambers cautioned in May that Cisco's 2012 fiscal year starting August would also not live up to the company's previous growth expectations.
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