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Cisco Systems Layoffs 2018: 460 Staff Cuts Amid CX Push

Cisco Systems has cut roughly 460 employees in and around its San Jose, California, headquarters as part of Customer Experience shakeup, Silicon Valley Business Journal reports.

LinkedIn: Cisco EVP Maria Martinez

Maria Martinez, the recently hired Cisco executive at the center of the company's organizational shakeup, notified employees of the restructuring in an Election Day email, the report noted.

Martinez, a Salesforce and Microsoft veteran, is executive VP and chief customer experience officer. She reports directly to CEO Chuck Robbins. Martinez is striving to align Cisco's Customer Experience (CX) initiatives to accelerate the company's business toward cloud and subscription services.

Those efforts are particularly important to channel partners -- many of whom are moving toward recurring revenue business models. The cuts come one week before Cisco Partner Summit 2018. The summit is a transition point of sorts for Cisco's channel leadership. Oliver Tuszik, a senior VP, recently succeeded Wendy Bahr in that capacity.

Cisco is also making SMB (small and midsize business) channel partner moves. The latest steps are expected to surface at Cisco Partner Summit along with this week's ConnectWise IT Nation 2018 conference in Orlando.

Cisco: Growing Amid Staff Changes

The Cisco job cuts are relatively limited considering the company's size and worldwide footprint. The firm employs more than 14,000 in Silicon Valley, and about 70,000 people worldwide, the Business Journal estimates.

CEO Chuck Robbins has made targeted staff cuts multiple times in recent years. The layoffs included 310 staff cuts in September 2017 and 1,100 layoffs in May 2017. That’s in addition to 5,500 job cuts announced in August 2016.

Cisco's overall business has been moving in the right direction and gaining momentum on the subscription services front. The company is expected to announce Q1 fiscal 2019 earnings on November 14. For its Q4 fiscal 2018, revenue was $12.8 billion, up 6 percent year over year. Also, recurring revenue represented 32 percent of total revenue, up 1 percent year over year.

Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.