Cisco Systems Layoffs 2020: Job Cuts Amid Global Economic Uncertainty
Cisco Systems confirmed layoff activity to The Wall Street Journal, but the networking giant did not disclose specific headcount figures involved. The cuts apparently are part of a $300 million restructuring plan that Cisco disclosed earlier this month.
Cisco CEO Chuck Robbins in recent quarters has expressed concerns about global economic uncertainty. During a Cisco Partner Summit keynote in November 2019, Robbins outlined multiple challenges facing the company, the economy and humanity. From the U.S. presidential impeachment investigation, to the trade war, to Brexit, to social unrest in South America, the world is facing some big challenges, Robbins noted at the time.
Fast forward to present day, and the coronavirus outbreak represents perhaps the biggest challenge yet — on both the social and economic fronts.
Still, Cisco continues to make progress on some fronts as it diversifies beyond networking hardware to offer more software and subscription services — particularly in such areas as security, managed services and SMB partner solutions.
Cisco Diversifies Revenue Streams
Cisco, which has roughly 75,000 employees, continues to extend beyond hardware — though hardware R&D certainly remains a core piece of the company’s business strategy. Recent milestones include:
- an enterprise-class managed services strategy that spans managed detection and response (MDR), secure SD-WAN and Unified Communications Manager (UCM) cloud.
- an aggressive SMB partner strategy, led by SAP, Microsoft and VMware veteran Marc Monday. Andrew Sage, VP of global distribution at Cisco, is also deeply involved.
- M&A, including such recent deals as the Exablaze buyout.
- cybersecurity innovations — including the recent SecureX cloud-native push.
- Developing chips that big cloud companies and service providers can purchase and use to build their own networking gear. The term to know: Cisco Silicon One.
There have also been rumors about Cisco potentially acquiring FireEye, but ChannelE2E doubts that chatter because FireEye’s business model and revenue mix don’t fit Cisco’s typical acquisition profile.
Cisco Financial Results, Next Moves
Cisco’s latest quarterly results, disclosed February 12, 2020, show that the company remains in business transition.
- Revenue was $12 billion for Q2 fiscal year 2020, down 4 percent from the corresponding quarter last year.
- Net income was $2.9 billion for Q2 fiscal year 2020, up 2 percent compared to the corresponding quarter in 2019.
- The company predicted Q3 fiscal year 2020 revenue would decline 1.5 percent to 3.5 percent compared to Q3 of fiscal year 2019.