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.