After Intel and IBM, another well-known technology giant Cisco has been hit with a layoff plan.
According to Phoenix Finance, Cisco's second wave of layoffs this year has been implemented.
On September 19th, several Cisco Dalian employees revealed to Phoenix Finance that they officially received a layoff notice today, and Cisco Blue Label (regular) employees in Dalian are expected to lay off about 300 people. The compensation plan includes two options: one is to leave directly, "N+7"; 2、 Delay for two months, 'N+5'. It is understood that in the future, most of Cisco's overall business may be transferred to India or Japan.
A Cisco employee told Fenghuang.com Finance: "The news of layoffs has been circulating since the Mid-Autumn Festival. Today, HR from the headquarters talked to many employees. Today, they have had a farewell dinner. Some departments have disappeared directly. Some project teams have cut three of their 20 employees, and will be cut later."
My target is a Cisco Blue Label employee who was notified of layoffs today. As far as I know, Cisco is probably laying off employees worldwide. Currently, the layoffs mainly involve nearly 300 Blue Label Japanese and Korean project employees, affecting positions such as TAC (technical after-sales). The red card layoffs should also be coming soon, which is only in the past three months, "said a family member of a Cisco Blue Label employee to Phoenix Net Finance.
According to insiders, blue cards refer to Cisco's formal employees, while red cards refer to Cisco's informal employees who have signed contracts with third-party companies. This wave of Dalian Cisco layoffs of about 300 people, and the remaining employees may also be laid off one after another.
A source familiar with the matter told Phoenix Finance: "The rumors of layoffs have been circulating internally before, and have just been confirmed today. This is already the second wave of layoffs at Cisco this year, with about 300 people laid off. The employees involved in this round of layoffs are all related to Japanese and Korean language projects. Not all Cisco non regular employees were laid off today, but it's hard to say what the future holds
Regarding compensation, a former Cisco employee in Shanghai told Phoenix Net Finance, "N+7 compensation is already very humane. Many colleagues who worked at Cisco for more than ten years used to travel around with compensation after being laid off." A Dalian employee who has not been laid off temporarily said, "It's still relatively safe at the moment, but people are still in a state of panic now
Cisco entered the Chinese market in 1994 and officially opened its Shanghai R&D center in October 2005. Afterwards, in January 2010, Cisco announced the establishment of the Greater China region. Cisco once monopolized global network equipment such as routers and switches. Cisco fought a 10-year "war" with Huawei and also went to court with Huawei over patent infringement issues.
The recent layoffs are not isolated incidents. As early as February this year, Cisco had already cut about 4000 jobs. This global layoff of about 7% is expected to affect over 6300 positions. In an official statement, Cisco stated that this move aims to create conditions for the company to invest in new growth opportunities and optimize its operational structure. It is reported that the financial pressure caused by the massive acquisition of Splunk is an important reason for the layoffs.
In terms of performance, according to Cisco's fourth quarter report for fiscal year 2024, Cisco expects its revenue to reach between $55 billion and $56.2 billion in fiscal year 2025. The average outlook for this performance is $55.5 billion, which falls short of analysts' expectations.
In addition, Cisco's net revenue for the fourth quarter was $13.642 billion, a year-on-year decrease of 10%; Net profit was 2.2 billion US dollars, a year-on-year decrease of 45%; The total revenue and net profit for the fiscal year 2024 decreased by 6% and 18% year-on-year, respectively, marking Cisco's first revenue decline since 2020.
Source: Read and Create Finance Comprehensive, Phoenix Network Finance