**Editor’s Note: Click here for a recap of layoffs impacting some of the biggest names doing business in the indirect channel.**
It won’t come as any comfort to the 6,000 Cisco employees who are losing their jobs, but the workforce reduction might be beneficial for the overall health of the company.
So says Jennifer Clark, vice president with 451 Research.
“Facing a dull second quarter result, Cisco has been doing what it can to maintain share price and return value to its investor including buying back stock ($1.5 billion in the quarter) and making dividend payments ($974 million for the quarter),” noted Clark, commenting specifically on a Telecompaper article. “The company has made 25 acquisitions since the beginning of 2012. It is the leader in SDN/NFV focused acquisitions since 2012 in terms of both number of acquisitions – seven – and spending on SDN/NFV acquisitions – approximately $4.789 billion. It is probably past time for the company to make a correction in the headcount number – which is no consolation for the 6,000 that will be affected.”
Cisco’s job-cut announcement came last week on its quarterly earnings call, when it said that revenue was down about half of 1 percent from the previous year amid a struggling global equipment market. The Silicon Valley giant cut 4,000 jobs just a year ago. The most recent cuts represent about 8 percent of the company’s workforce.
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