Cisco’s revenue to rise, but it will cut 4000 jobs

although cisco results published today, the company’s revenue is steady rebound, but cisco said, they will cut 4000 jobs each next quarter.

the cisco Q4 net revenue of $12.4 billion, more than $11.7 billion over the same period last year growth of 6.2%; Net profit of $2.3 billion, more than $1.9 billion over the same period last year growth of 18.4%. In addition, the cisco Q4 this year for 42 cents earnings per share, the company expects the next fiscal year in the first quarter, cisco’s earnings per share of 50-52 cents. After Wall Street to cisco’s earnings forecasts for 51 cents per share.

cisco CFO Frank card Ronnie (Frank Calderoni), said the job cuts will mainly implemented in the first quarter of the new fiscal year, the reorganization is expected to cost up to $550 million (before tax). Cisco CEO John Chambers (John Chambers) call this the cuts “rebalancing” of labor. He said during the earnings call: “although the company maintained a steady rebound slightly, can advance footsteps did not meet our expectations.”

on the news, after cisco’s shares fell 9%.

it is understood that this is the cisco’s second round of job cuts this year. In early march, cisco to rescind his contract with 500 employees, the company said it was a “occasionally personnel adjustment. In the next six months, cisco headquarters to cut 1300 jobs, accounting for 2% of the number of company headquarters. Not only that, but two summers ago, cisco also made a more massive layoffs. Fired when the company reached 6500 people, of which 15% is vice President of levels of the executive staff. It is understood that cisco paid $1.3 billion and its equivalents.

so, summer planned layoffs seemed to become a hallmark of cisco.

Q4 this year, cisco’s main business revenue grew by 5% year-on-year. Among them, the switches connected to the Internet interactive business (Internet switching) revenue of $3.8 billion, accounted for 30%; Streaming media Service network software (Service provider video) revenue of $2.1 billion, accounted for 17%, rose 23%; Wireless network equipment sales up 32% from a year earlier. Professional analysis of the growth, with cisco acquisition software company NDS Israel last year ($5 billion, and bonds), as well as the main cloud infrastructure Meraki company ($1.2 billion). In addition, the data center of cisco’s business revenue grew 43% year-on-year, but the total sales revenue ratio is small.

in a telephone interview with the media, Chambers said: “jobs such as structural adjustment, is a very common thing, the key lies in downsizing is not an end but a means for the development of the company. To the power of a growing company, to optimize resources combination, cisco need such one-time planned layoffs.”

company MoorInsights authority technology industry market analysis and Strategy of the founder and chief analyst Patrick mercer, Hyde (Patrick Moorhead) pointed out that cisco in the Internet business transformation. He said: “on a large scale, continue to extend outward data center business, did not bring the same degree of cisco collection management function, and also for cisco has spent a lot of money. At the same time, cisco also want a share in the field of open integration solutions, and this is the HP and IBM are good at.”

maybe cisco does like, Hyde said, but still in the field of sales data stack, cisco plays an important role. Currently, it has become the world’s second largest, after HP blade server vendors based on x 86 architecture. In addition, in the field of enterprise network accessories, cisco still dominates.