Cisco Layoffs In the Offing?

Cisco Systems (Nasdaq: CSCO) has a new chief financial officer in Frank Calderoni, who is replacing Dennis Powell. He officially starts his gig on Friday, Feb. 15. And as all good finance folks who know how to count pennies, Calderoni might have to oversee a round of layoffs at his new employer.

Sources are telling us that the company is looking to trim headcount in divisions that are not bringing in the bucks. The cuts are going to be big enough to raise an eyebrow. I am trying to chase down the actual size of the cuts and will update the post later. I checked with Cisco’s (CSCO) public relations department and a spokesperson emailed this response:

Cisco does not comment on rumors or speculation. I can tell you however, that Cisco constantly reviews ways to streamline and optimize business processes for improved efficiency and increased shareholder value. As discussed on Cisco’s results conference call last week, at the end of Q2 Cisco headcount totaled 64,087, a net increase of approximately 1,000 from Q1 FY’08. We will continue to invest in headcount in the areas where we see continuing opportunities for growth.

Cisco reported its fiscal 2008 second-quarter earnings earlier this month, and gave a lukewarm forecast for the remainder of the year. Wall Street analysts were disappointed by the 10 percent year-over-year growth outlined by Cisco for the April 2008 quarter.

Cisco also missed its own internal bookings targets for the first time in five years, indicating that things aren’t all that kosher, not only for the company but for the tech industry overall.

Comments

[Andrew Bond:]

Given that Cisco has recently purchased/leased??:
The huge 5 building complex enclosed by Tasman Dr.& McCarthy Blvd., & Alder Dr. in San Jose, CA
AND
The smaller 5 building complex at Murphy Ranch Rd. & McCarthy Blvd. in Milpitas, CA
It doesn't seem likely Cisco will have a big layoff after acquiring so much space (the bldgs are currently under construction / reconfiguration to Cisco std?)

2008 Mar 24 09:06 PM