Just days after announcing that it would pay $2.7 billion to acquire network security firm Sourcefire, Cisco said Wednesday that it would cut 4,000 jobs, or roughly five percent of its workforce in an effort to cut costs.
Cisco executives said the cuts were in response to a weaker-than-expected economic recovery.
In a conference call discussing the companys fourth quarter and fiscal year 2013 earnings, Cisco CEO John Chambers said the company needs to “move fast” as it rebalances staff to meet needs in growth areas, likely to be areas such as data center, cloud computing and security.
The cuts announced by the veteran networking giant on Wednesday came despite an 18.2 percent jump in earnings, pushing Cisco (NASDAQ:CSCO) shares down 9.6 percent in after-hours trading. Cisco reported fiscal Q4 earnings of $2.3 billion based on revenues of $12.4 billion, up 6 percent year over year from 2011 when the company earned $1.9 billion on revenues of $11.7 billion.
Chambers said business in China was down 6 percent during the quarter, while business in India grew 19 percent.
Last July, Cisco cut 1,300 jobs, and in July 2011 the company cut 6,500 positions as part of a company restructuring.
Cisco said its cash and cash equivalents and investments totaled $50.6 billion at the end of the fourth quarter of fiscal 2013.