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Cisco to slash 6,500 jobs; India plans unclear
Networking technologies major Cisco plans to slash 6,500 jobs, about 9 per cent of its global workforce, as part of an operational revamp to boost profitability.
The workforce reduction is a part of the company's strategic goal to bring down annual operating expenses by $1 billion.
"We plan to reduce our global workforce by approximately 6,500 employees across all functions... This also includes a reduction totalling approximately 15 per cent of vice president-level and above employees," Cisco said on Monday.
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Cisco to slash 6,500 jobs; India plans unclear
Out of the total 6,500 employees, about 2,100 people have opted for a voluntary early retirement programme.
Cisco noted that the overall reduction would account for about 9 per cent of its full-time workforce.
At end of April, the entity had over 73,400 employees. However, it was not immediately clear whether the job cuts would affect Cisco's India operations.
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Cisco to slash 6,500 jobs; India plans unclear
"We are moving quickly to focus our product portfolio, simplify our operations (including significant cost reductions) and allocate our capital in the most productive way possible," US-based Cisco said in a statement.
The job cuts would result in pre-tax restructuring charges of up to USD 1.3 billion over several quarters.
"Substantially, all of these charges are cash-based. Cisco expects that approximately $750 million of these charges will be recognised during the fourth quarter of fiscal 2011," the firm said.
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Cisco to slash 6,500 jobs; India plans unclear
Meanwhile, Cisco will offload a Mexican manufacturing facility with 5,000 employees to Taiwan's Foxconn. However, financial details of the deal were not disclosed.
Cisco executive vice president and chief operating officer Gary Moore said the sale would further simplify and consolidate the company's manufacturing operations.
The deal is expected to be complete by October, 2011.