Cisco workforce reductions

> Today we announced our Q3 FY26 earnings with record revenue of $15.8 billion, up 12 percent year over year, and double-digit top and bottom-line growth. The ELT and I could not be prouder of the growth you have all delivered for Cisco.

Interesting decision considering they aren't at any sort of risk.

"...fewer than 4,000 jobs, representing less than 5 percent of our total employee base."

I cringe at this attempt to soften the numbers by saying "fewer than" and "less than" here. Conversely, and ironically, it also puts inflated numbers in your head.

"How many people will be axed at Cisco?"

"3,998 ... but at least it's fewer than 4,000!"

This type of thing should come along with a reduction of allowed H-1bs.

"I could not be prouder of the growth you delivered"

Note the "you delivered"...

---

A few lines later

"With this, we are making changes today that will result in the reduction of our overall workforce in Q4 by fewer than 4,000 jobs"

Rough, bit on the nose no?

This kind of behavior is never tolerated in the market. Your revenue is flat; they lay you off. Right away. No trial, no nothing. Your revenue is down, right to layoffs, right away. Revenue grows but less than guidance? Layoffs. Record revenue exceeding guidance? Believe it or not, layoffs.

Almost bought cisco shares today, glad I didn't.

A workplace that values job security is such a motivating factor for employees that I don't think is recognized enough. At a company that conducts layoffs, it feels like you're just waiting for the next one.

My extremely cynical, but not yet proven wrong view:

Tech, more or less, has a group of investors centered around Silicon Valley. Not the only ones, but especially now, the most active. Generally, these folk have a lot of exposure to AI, and probably mostly believe the hype around it.

Which means they believe companies using AI should produce better results, which in the current market means short-term cash. So if a company doesn't do layoffs, no matter how well it is doing, it is seen as irresponsible and investment is withheld from it.

GitLab's announcement felt illustrative of this dynamic:

- The actual reductions were focused on simplifying org structure, nothing to do with AI

- They identified MORE work that was on their roadmap because of the way AI is changing software engineering

- They made sure to include a special section for investors

Seems to me they should have made the org changes in an unrelated announcement, and celebrated the opportunity for new work and the possible hiring that might be required to accomplish it all.

Like, GitLab is in an incredible position to moonshot the next generation of software. AI needs new substrate to work most effectively, and GitLab is the most popular "alternative" substrate to the fragile dinosaur that Github has become.

But AI needs to be seen as cutting costs above all else, so they can sell more of it everywhere, and this is what we get.

> We will provide support in finding new opportunities, whether internal or external, through Cisco’s placement services – a program that has seen 75 percent of participants discover their next role.

25% unemployment doesn't seem like something to brag about.

one would think that those jobs identified as superfluous or dispensable are in administration more than in engineering. The lay-off procedure itself looks very bureaucratic and makes HR, lawyers, and managers indispensable. Cunning plan.

Cisco is well known to do annual layoffs, this shouldn’t be a surprise to anyone.

Cisco do not have real ai strategy . Routers are routers. Even their ai factory is yet another box just with label nvidia on it . No major investment needed.

All that observability tooling around is only benefiting ai wave . They can vibe re-write everything .

Cisco's fiscal year closes at the end of July, which makes this time of year the season for reorgs, LRs (as they're colloquially known) and the usual maneuvering that leads up to establishing budgets, sales quotas and the like. It sucks that this kind of thing has become so normalized now.

The casualness of mentioning record revenues in the same PR statement as laying off 4,000 people is fucked up on a new level. It used to be you were supposed to at least pretend you were forced into a layoff. But now it's like "Hey guys! It's time for our regularly scheduled layoff to juice profits! I got an extra $5M bonus for this!"

> We have important, impactful, and consequential work ahead

writing so bad claude could do better

"Executive Leadership Team" is such an interesting phrase. Never in several years inside Apple spanning Steve Jobs and Tim Cook heard any such condescending nonsense.

I believe it's because they truly didn't think that way.

In the past week, we've had:

* Build for the future (Cloudflare)

* Our path forward (Cisco)

What else did we miss?

The other thing is that the laid off employees will lose all their unvested RSUs. These shares were granted as compensation for past performance but they can now be conveniently clawed back by the company just because they decide to lay you off. Stock can be a large part of someone's compensation in a tech company. Companies shouldn't be allowed to benefit this way if they decide to lay off employees.

> reduction of our overall workforce in Q4 by fewer than 4,000 jobs

Interesting use of fewer.

This is why corporations need to be owned and operated by the employees.

5% reduction returns them to the headcount on what date? Something like mid 2022 if the info I'm finding is correct.

OK looks like the horn has been blown. Now they are all doing layoffs. Wall Street waving its visible hand again?

This is why you owe nothing to your employer, record revenue with management bonus, and layoffs for those that helped get there.

Those extra hours? Only if the team really needs them.

Naturally this tends to be something only seniors see, thus ageism.

OMG, press the “read aloud” button. Brings me right back to to computer class in 1995!

It's important to keep in mind Cisco made a billion AI and cybersec acquisitions in the past few years and they've downsized to 2022 levels.

This is not an AI job elimination story. I think the next recession will trigger that. The AI hype train ironically needs engineers of all stripes to run.

Coinbase, CloudFlare, Cisco.

Another round of layoffs at CrowdStrike would fit the pattern nicely.

Whenever a company does layoffs willy nilly frequently I stop trusting them with my career. The AI excuses are lazy.

I was laid off last year by one of the big tech companies, and they called me again for a rehire but I just dont trust them anymore even if they pay more. The layoff completely disrupted my life and I developed health issues because of the stress. Not worth the mental hassle.

I have seen a few workplaces which are more deliberate in their hiring and are not on 24x7x365 hire and fire mode unlike many of the big names. I would rather work in such a place rather than have 10 varieties of coffee and condiments in the pantry.

Frankly i'm pissed off.

Sorry for the people who pinned their hopes on cisco and were laid off yesterday. It's not easy.

> I could not be prouder of the growth you have all delivered for Cisco.

I think you could be. Just saying.

its sickening that these companies making 10s of Billions in profit annually at 60% gross margins are going to throw their employees that got them there under the bus.

layoffs are for at risk companies undergoing restructuring not semi-annual financial engineering of your earnings release

I’m not a big collective action proponent historically but in the face of this bs, it might be time.

>To those leaving Cisco, thank you for your contribution, your dedication, and the mark you have made on this company. We are deeply grateful and are committed to handling this transition with the care, clarity, and respect that defines our culture.

Who the hell needs gratitude if you can't earn an income.. seeing all of these layoffs I cant help but think something along the lines of .. Those of use who greatest asset is our labor need to recognize the great risk it is at of going to 0 value in the near future, and renegotiate everything to get as much value out of that asset before it does. Like enough to retire on. And as with established theories of intelectual property rights protect creators moral rights to the profits of their work, there needs to be mandated moral rights that stop peoples labor being used as training data for AI without the consent, and without a path or compensation for the loss of income that will cause them.. Otherwise this is just one big transfer of power from most people, to people with capital, who can then wield that power in more capricious and selfish ways.

“We are running out of good ideas to execute on, so we are reducing our workforce to a quantity we can utilize.”

how big is the WFR ?

Revenue, not profit. A lot of that is likely inflation. I suspect we'll see this pattern repeat quite a bit with the oncoming oil shock

"...fewer than 4,000 jobs, representing less than 5 percent of our total employee base."

I cringe at this attempt to soften the numbers by saying "fewer than" and "less than" here. Conversely, and ironically, it also puts inflated numbers in your head.

"How many people will be axed at Cisco?"

"3,998 ... but at least it's fewer than 4,000!"

Cisco is well known to do annual layoffs, this shouldn’t be a surprise to anyone.

5% reduction returns them to the headcount on what date? Something like mid 2022 if the info I'm finding is correct.

OK looks like the horn has been blown. Now they are all doing layoffs. Wall Street waving its visible hand again?

This is why you owe nothing to your employer, record revenue with management bonus, and layoffs for those that helped get there.

Those extra hours? Only if the team really needs them.

Naturally this tends to be something only seniors see, thus ageism.

It's important to keep in mind Cisco made a billion AI and cybersec acquisitions in the past few years and they've downsized to 2022 levels.

This is not an AI job elimination story. I think the next recession will trigger that. The AI hype train ironically needs engineers of all stripes to run.

Whenever a company does layoffs willy nilly frequently I stop trusting them with my career. The AI excuses are lazy.

Frankly i'm pissed off.

Sorry for the people who pinned their hopes on cisco and were laid off yesterday. It's not easy.

> I could not be prouder of the growth you have all delivered for Cisco.

I think you could be. Just saying.

Interesting decision considering they aren't at any sort of risk.

Wall St gonna Wall St

This type of thing should come along with a reduction of allowed H-1bs.

Cisco especially is absolutely full of H1Bs.

As someone that has worked for them a decade ago, some of their division are >90% Indian. Those are all good engineers and not dunking on them at all but it should be unacceptable to bring over competing workers on a visa while also laying off so many people.

> This type of thing should come along with a reduction of allowed H-1bs.

H-1Bs also lose jobs in these layoffs, so there is an implicit reduction.

Unlikely to happen when H1B program benefit corporate and they run super PACs

Any policies to help the people are labeled as "socialist" nowadays

I’d prefer a forced resignation of the CEO and board with no severance.

I think H1Bs are pretty much dead with the 100k fee.

"I could not be prouder of the growth you delivered"

Note the "you delivered"...

---

A few lines later

"With this, we are making changes today that will result in the reduction of our overall workforce in Q4 by fewer than 4,000 jobs"

Rough, bit on the nose no?

My company just did something like this. We completed a big redesign and the CEO sent an email saying how proud he was of our work. Layoffs started the next week.

lol! For those that didn’t get the Parks and Rec reference: https://m.youtube.com/watch?v=eiyfwZVAzGw

> This kind of behavior is never tolerated in the market

This is Cisco. They do layoffs every quarter and have been doing so since the early 2000s.

We have the best market in the world, because of ~~AI bubble~~ layoffs.

Almost bought cisco shares today, glad I didn't.

If you had, your investment would be up 20% now. https://www.nasdaq.com/market-activity/stocks/csco

They buy a lot of companies then restructure them and that causes these layoffs. I think it’s just normal way of doing business for them. And the stock is up 20% after hours =)

My extremely cynical, but not yet proven wrong view:

GitLab's announcement felt illustrative of this dynamic:

- The actual reductions were focused on simplifying org structure, nothing to do with AI

- They identified MORE work that was on their roadmap because of the way AI is changing software engineering

- They made sure to include a special section for investors

Seems to me they should have made the org changes in an unrelated announcement, and celebrated the opportunity for new work and the possible hiring that might be required to accomplish it all.

But AI needs to be seen as cutting costs above all else, so they can sell more of it everywhere, and this is what we get.

We use GitLab. They are no way in an incredible position to moonshot anything. They are yet another git provider with a management plane around it.

> GitLab is in an incredible position to moonshot the next generation of software.

I don't think they offer anything unique. Forgejo[1] offers a similar platform.

[1] https://forgejo.org/

Yours is not just cynical but also wrong and naive. Here's a simpler one: all evidence points to AI bringing at least 10-20% more productivity. This means some companies will lay off. You don't need sophisticated cynicism when a simpler explanation is available.

25% unemployment doesn't seem like something to brag about.

Maybe they found something outside the program, but your cynical take is way more entertaining.

Cisco do not have real ai strategy . Routers are routers. Even their ai factory is yet another box just with label nvidia on it . No major investment needed.

All that observability tooling around is only benefiting ai wave . They can vibe re-write everything .

At this point Cisco is a conglomerate that does everything and nothing. They own so many different verticals that even people working there don't really know what cisco fully does anymore.

But I agree though, this is an artificial stock pump because of the rush for picks and shovels.

What’s really weird to me is they clearly wanted to convey to the Street that these layoffs were _not_ motivated by any of their financial results with the phrasing “fewer than 4,000”. But they conspicuously didn’t provide any other reason. No divisions closing down, no realignment of capital.

I wonder if someone in the C-suite simply decided that they had some rough percentage of underperformers on the payroll, but they can’t publicly call them performance based terminations without triggering a risk of lawsuits.

> We have important, impactful, and consequential work ahead

writing so bad claude could do better

I do wonder if we're going to start seeing people intentionally writing poorly so it's clear their memo is not just "Claude, please write an email saying that..."

> It's not just impactful, it's consequential

I really battled to read his memo. The it was written in English, but a very odd style indeed.

"Executive Leadership Team" is such an interesting phrase. Never in several years inside Apple spanning Steve Jobs and Tim Cook heard any such condescending nonsense.

I believe it's because they truly didn't think that way.

Tim Cook has referred to the “E-Team” in many earnings calls. I am guessing that consists of the SVPs who are above the horizontal line on https://www.apple.com/leadership/

XCOM (Executive Committee) was my least favorite at one of the soulless corps i worked at years ago.

In the past week, we've had:

* Build for the future (Cloudflare)

* Our path forward (Cisco)

What else did we miss?

On and off for the past year or so, the commercials from TD Bank have been

* More Human

as they've slowly laid off people due to the AML fines they've been dealing with in the U.S. and replacing folks with either AI, more Indian/Canadian/Ireland talent.

The journey ahead (next known layoff company)

Alas this happens in all FAANG layoffs too, some lucky people get to received one more vest but nothing close to all unvested RSUs

> reduction of our overall workforce in Q4 by fewer than 4,000 jobs

Interesting use of fewer.

seems like the same trick as behind labelling price as $99.9

This is why corporations need to be owned and operated by the employees.

For the last 15 years I’ve been telling anyone who would listen about my idea for a John Lewis (British retail chain) model IT consultancy- employee owned, everyone is motivated, high quality, etc.

Except last month I met someone who worked there and got TUPE (involuntary contractual transfer of employment) to Wipro (Indian outsourcerer) a few years ago.

So even though this corporation is owned by the employees, and is one of the best examples of this in the UK, it seems you also need some kind of management structure that is also immune to the usual senior leadership trolls to avoid it turning out to be shitty.

Have you look at how efficient your local government is?

You'll also be less exposed in privately owned companies.

these corporations would never work because they would optimise for the wrong thing - they would get their face eaten by other more efficient and ruthless corporations

OMG, press the “read aloud” button. Brings me right back to to computer class in 1995!

sounds like a daft punk song !

Coinbase, CloudFlare, Cisco.

Another round of layoffs at CrowdStrike would fit the pattern nicely.

Meta , ms ( soft ) , Google .

its sickening that these companies making 10s of Billions in profit annually at 60% gross margins are going to throw their employees that got them there under the bus.

layoffs are for at risk companies undergoing restructuring not semi-annual financial engineering of your earnings release

I’m not a big collective action proponent historically but in the face of this bs, it might be time.

> that got them there under the bus.

Do you employ construction workers for lifetime after they have built your house?

Layoffs are not “for” that. That’s your fantasy.

You believe more in the individual relationship each worker has with their employer to negotiate times like these? With what power? The employees did excellently so they are being let go. The individual worker has no leverage for anything.