Cisco Systems announced yesterday that it cut 14 percent of its global workforce, or about 11,500 employees, as part of a reorganization generally expected.
The network equipment maker expects to save $ in the year 6500 to 1000000000 by eliminating jobs and voted for by 2,100 people for participating in an early retirement program. The cuts, which is higher than the number of rumors last week, including a reduction of 15 percent for employees with VP or higher, were the company said.
The company in San Jose, Calif.-based company also plans to eliminate about 5,000 jobs through the sale of its set-top box manufacturing facility in Juarez, Mexico, Foxconn. Cisco said a factory worker in Mexico would be employees of Foxconn in the first quarter of 2012 and that no job losses were expected by the installation of the sale.
Cisco said it will take a one-time fee of $ 1300000000 to cover the costs of rehabilitation.
The company has announced to cut jobs in order to fight against his property into trouble during its third quarter earnings report in May. Said “The decision to include the reduction of our full-time employees and contractors as a way to reduce costs is difficult,” Cisco Chief Operating Officer Gary Moore at the time.
The company has a bad luck had tried to move into the consumer sector, and disappointing for some movement, which killed recently, the Flip camcorder on their networking activities concentrate on bread and butter.
But how Cisco moved into new markets, sales slowed in the core and Cisco have lost market share. While Cisco still dominates the market for IP-routing, has been increasingly challenged in its Ethernet switching business to competitors such as Hewlett-Packard and Chinese manufacturers like Huawei.