Cisco Systems Inc. this week reported 18 percent growth in profit but, nonetheless, is laying off 4,000 workers in a decision that holds unclear implications for the channel.
A Cisco spokesperson said the company is not yet saying where job cuts, in terms of geographies or business units, will be made, as employees have not been notified.
What is clear is that Cisco is facing headwinds from a continued weak economy that has organizations scaling back on capex purchases, and from competitors selling their wares for less money – Cisco is known for premium pricing on its gear.
CEO John Chambers said during this week's earnings call with analysts that the layoffs are intended to reduce the layers of people in its different divisions, some of which have been slow to respond to technology changes.
The job losses will bring to about 12,000 the number of cuts Cisco will have enforced over the past two years.