Cisco Layoffs for AI Focus

Cisco Systems is set to announce a significant round of layoffs, potentially affecting thousands of employees, as the company pivots towards higher-growth sectors such as cybersecurity and artificial intelligence (AI). Sources indicate that the number of job cuts may be comparable to or exceed the 4,000 positions eliminated in February. The announcement is expected to coincide with the release of Cisco's fourth-quarter financial results, with insiders noting that the company employed approximately 84,900 individuals as of July 2023, prior to the earlier layoffs. The San Jose-based networking giant has faced challenges, including sluggish demand and supply chain issues, prompting a strategic shift away from its traditional business model. In a bid to diversify, Cisco completed a $28 billion acquisition of cybersecurity firm Splunk in March, aiming to enhance its subscription-based revenue and reduce dependence on one-time equipment sales. This move aligns with Cisco's broader strategy to integrate AI into its product offerings, with a goal of achieving $1 billion in AI product orders by 2025. In addition to its acquisition strategy, Cisco has launched a $1 billion fund to invest in AI startups, further emphasizing its commitment to this emerging technology. The layoffs at Cisco reflect a broader trend in the tech industry, which has seen over 126,000 job cuts across 393 companies this year as firms adjust to the financial implications of substantial investments in AI.