historically one of the strongest and more profitable technology firms. Its
performance over the last several months has declined significantly in the face
of increasing competition and the admitted fact that Cisco was trying to
compete in too many markets at the same time. Things are not looking good for
Cisco and the company is looking at shedding workers in an effort to save
Cisco wants to save about $1 billion and is looking at layoffs and many other
things to get the company back on the path to increasing profits. WRAL.com reports
that Cisco is looking at shedding "thousands" of workers to help
has 73,000 workers globally and the company has already eliminated 550 jobs and
killed off some of its products that weren't as profitable as it hoped. One of
the products that were killed recently was the Flip line of video cameras.
Reuters reports that Cisco has warned that the overall Q4 revenue would be flat with only
2% growth compared to the same quarter of the previous year. That would imply
that profits would be in the $10.84 billion to $11.05 billion range, rather
than the expectation of $11.59 billion.
The flat profits led to a decline in stock price with Reuters reporting
the stock was at $17.72 per share, down 1%. Cisco CEO John Chambers said that
the workers that would be impacted in the layoffs would know soon, likely by
the end of the summer. The company has also offered early retirement packages
to some workers to cut costs. Chambers said, "Cisco is a very strong
company in a healthy market with a few problematic areas."
One of the areas that analysts and investors are looking for growth and detail
on is the core switching business that Cisco has been a big part of for many
years. CFO Frank Calderoni told Reuters that he could not say when the
switching business would grow again.
quote: What do you mean? John Chambers only earned 18,871,850.00 last year. That means he only paid himself 471 times the average American pay of 40k a year.
quote: Remember that businesses exist solely to make a profit. If they don't, they disappear and all the jobs that they provide disappear with it.