Despite an 18pc increase in net profit, networking equipment maker Cisco is to cut 4,000 jobs, or about 5pc of its workforce, in an effort to reduce costs while demand for its equipment remains shaky.
Cisco reported net income of US$2.3bn in the fourth quarter, up from US$1.9bn in the year-ago period.
John Chambers, Cisco’s chairman and CEO, told analysts in a conference call that the jobs cuts were down to to weaker sales in China, Japan and Europe and a “slower and more inconsistent economic recovery”.
Chambers said the company is struggling with a large, slow-moving organisation at a time when Cisco needs smaller teams that make decisions more quickly, NASDAQ.com reported.
Cisco’s fourth-quarter revenue amounted to US$12.4bn, an increase of 6pc year-over-year.