Computer networking giant Cisco announced Wednesday that it would lay off thousands of workers as part of a restructuring plan.
Announcing its latest quarterly earnings figures, the Silicon Valley-based Cisco company said that about 5% of its global workforce will be affected by the layoffs.
According to Cisco**, it had nearly 85,000 employees at the end of last year.
Analysts say tech layoffs could become the new normal amid Silicon Valley's aggressive shift to artificial intelligence.
The scale of this layoff is different from late 2022 and early 2023, when tech companies laid off hundreds of thousands of people – the first of a hiring frenzy during the pandemic, when companies increased their headcount as everyday life became more popularized.
Late last year, Cisco agreed to buy cybersecurity company Splunk for $28 billion**, its largest acquisition ever.
Analysts say cybersecurity has grown into a huge business for tech companies, and the deal puts Cisco, which is primarily known for routers and networking equipment, on an equal footing with rivals Palo Alto Networks, Check Point, Crowdstrike and Microsoft.
Cisco reported revenue of $12.8 billion for the fiscal quarter ended January, down 6% from the same period last year. The company said its profit was $2.6 billion, down about 5% from the same period last year.
Cisco CEO Chuck Robbins said in earnings: "We will continue to align our investments with future growth opportunities. "Our innovation sits at the center of an increasingly connected ecosystem and will play a key role in our customers' adoption of AI and the protection of their organizations. ”
Following the earnings release, Cisco's stock price was trading more than 5% to 47$65.