Cisco says it will lay off thousands of its employees

SAN FRANCISCO – Networking equipment maker Cisco Systems Inc. is cutting 6,500 employees – about 9 percent of its workforce – as it follows up on a plan announced in May to eliminate thousands of jobs to reduce costs and raise profits.

Cisco, which has about 73,400 employees worldwide, said Monday it was laying off 4,400 people. Another 2,100 employees chose to leave as part of an early retirement program. The company said the cuts include the elimination of 15 percent of its employees at and above the level of vice president.

Cisco said the cuts will cost $1.3 billion in severance and termination benefits. The company plans to take the charge over several quarters. It will take $750 million of that, including $500 million for the early retirement program, during the current quarter.

Cisco will inform employees who have been cut in the U.S., Canada and some other countries during the first week of August.

Associated Press