Cisco has announced 5,500 job cuts, about seven per cent of its workforce, in yet another round of cuts at the company.
The redundancies, which include 300 staff in the UK and Ireland, come despite Cisco announcing full-year revenue of $49.2bn and net income up 20 per cent to $10.7bn.
The move appears to be part of what has become an annual tradition at Cisco whereby the company lays off employees whose talents it decides it no longer needs, and hires new, cheaper staff with different skills, unaware of the company's penchant for making people redundant every year.
Cisco's excuse this year is that the firm needs to "pivot" to follow the vogue for software-defined networking, which requires staff with more skills in this area and fewer in developing networking hardware.
"We are looking at the areas where we believe growth will come faster," said new-ish CEO Chuck Robbins in the earnings conference call.
"It's not that we're ignoring one in favour of another, we just want to make sure our investments are commensurate with the growth opportunity."
Analysts have suggested that the shift towards cloud computing is changing the networking equipment market as cloud providers require ultra-high-end networking devices to handle the volumes of data with the performance that customers need, while demand from corporates for data centre networking products is levelling off.
Cisco announced cuts in 2009, 2011, 2012, 2013, 2014 and, after a pause following Robbins' appointment, 2016. The company has laid off 29,000 staff since 2009, which would have halved the headcount. Instead headcount has stayed in the same region of 70,000 to 75,000 permanent staff.
One review of the company on the Glassdoor website lists "Good outplacement services" as a benefit of working at Cisco.
Meanwhile, TheLayoff.com blog contained plenty of grumbles from disgruntled staff. "Yet again the older and higher grades are getting hit, replaced with cheaper resources. ‘Newer skills' is [a] cover for offloading the long-term people that have given years of quality service," said one.
Another suggested that the relatively modest level of lay-offs is just PR and that the real number that will be shown the door is likely to be much higher.
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