Cisco Plans Restructuring, Potential Job Cuts as Focus Shifts to High-Growth Sectors: Report – NVIDIA (NASDAQ:NVDA), Cisco Systems (NASDAQ:CSCO)

Cisco Systems, Inc. CSCO It is reportedly set to restructure its operations, potentially resulting in thousands of job cuts as it aims to prioritize high-growth sectors.

The exact count of affected employees is still being studied by the company, Reuters reported, citing three people familiar with the matter.

The announcement could be made as early as next week, in conjunction with the company’s earnings meeting scheduled for February 14.

In November 2022, during an earnings call, Cisco announced a restructuring that would affect about 5% of its workforce, resulting in $600 million in severance and other expenses, the report said.

In its previous earnings call, Cisco cut its full-year revenue and profit projections, pointing to slowing demand for its networking equipment.

The company attributed the weakness to declining orders in the first quarter, citing customer focus on product installation and deployment, Reuters added.

In recent years, Cisco has faced supply chain challenges and a slowdown in demand following the pandemic, prompting a shift toward software solutions such as cybersecurity.

Earlier this month, Cisco signed a pact with Nvidia Corporation NVDA facilitate the development of AI-based enterprise computing infrastructures by expanding the accessibility of AI technology beyond major data center operators.

This collaboration allows Cisco to integrate Nvidia’s AI-focused technology with its networking solutions.

The partnership improves Nvidia’s distribution channels and allows Cisco to capitalize on the continuing wave of investment in artificial intelligence that has elevated Nvidia to the status of the most valuable chipmaker globally, Bloomberg reported.

Price Action: CSCO shares closed 0.36% higher at $50.13 on Friday. After the close, shares rose 0.02% to $50.14.

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This content was partially produced with the help of artificial intelligence tools and was reviewed and published by Benzinga editors.

Photo: Shutterstock

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