According to Hasan Imam, an analyst at Thomas Weisel, Cisco systems is in the process of cutting between 1,500 and 2,000 jobs. The technology company, which has been working to reduce annual costs by $1 billion, has already cut travel budgets and variable compensation, and Imam is convinced that a "headcount reduction" will be its next step toward fiscal sustainability. The layoffs would cut yearly expenditures by $200-250 million, enabling the company to exceed its targeted budget reductions.
Cisco spokesmen have yet to comment on the rumor.
Imam also suggested that Cisco's July revenues are on track to exceed the average analyst estimate. According to his report, he expects 2010 earnings to rise to $35.82 billion, or $1.44 per share, a slight rise over his earlier estimate of $34.88 billion/1.41 per share.
The job cuts, while significant, represent only a three percent reduction in the company's 66,000-person workforce.
Although shares were down in early trading, they have risen by sixteen cents and are currently trading at $18.20.
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