Main reason is sluggish spending by corporations
IFM Correspondent
August 18, 2016: California-based computer networking giant Cisco announced that it will cut up to 5,500 jobs. It announced the cuts – about 7% of its global workforce – during its earnings reports.
Sluggish spending by corporations and telecom carriers on network switches and routers have prompted it to take the action even as it makes a shift towards cloud computing.
The company said that its sales in the UK had been hit by the country’s decision to leave the EU. Cisco CEO Chuck Robbins said the referendum had a ‘real impact’ on the business and called for clarity on how the process of leaving the EU will work. “Even clarity about a timeline could be helpful,” he said, adding the company remains committed to the UK even after it leaves the EU.
Earlier in April, Intel had announced jobs cuts of up to 12,000.
Cisco beat analysts’ estimates with a quarterly profit of $2.8 billion on revenue of $12.64 billion. Adjusted profits would have been 63 cents a share. Analysts surveyed by FactSet predicted adjusted earnings of 60 cents a share on revenue of $12.57 billion.