Cisco silent on Aussie job cuts

Cisco has kept mum on whether any of the 10,000 job cuts reportedly being considered by the company will affect Australia.

Yesterday CRN reported comments by a US banking analysts that Cisco might need to shed 5,000 jobs.

However, US business wires service Bloomberg today reported sources close to the company putting the figure at closer to 7000 jobs, with sackings possibly starting as early as September.

But the Australian office would not confirm the cuts or say where they may land. It also refused to reveal local headcount including the size of its security team, and said it would disclose details on 10 August.

‘As we announced on our Q3 earnings call, Cisco will take out US$1 billion in costs from our FY 12 expense run-rate as part of our efforts to streamline company operations, including a planned reduction in workforce," it said in a statement.

"We will provide additional detail on the cost reductions, including layoffs, on our next earnings call on August 10, 2011."

In May analysts were expecting Cisco to cut up to 4000 jobs -- its largest cuts since 2002, after the internet bubble burst.

However, unlike previous layoffs, Cisco does not face a collapse in stock valuations, but rather mounting pressure from rivals, such as HP and Juniper Networks, and video-conferencing rivals such as Polycom.

HP this week boasted the 2.5 per cent gains it made in Layer 2 and 3 Ethernet switching revenue in the first quarter of 2011 at a time when Cisco’s share fell 5.8 percent.

Additionally, a Cisco merger with storage and virtualisation kingpin EMC could also make sense in order to make the former a more competitive player, according to Marshall.

With Liam Tung.

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