Thread regarding Cisco Systems Inc. layoffs

Cisco came in better than market expectations and that is reflected in share price.

That's not exactly a ringing endorsement given that the market expectations were down from previous quarters/years.

In addition Cisco is moving towards a recurring revenue model and away from one off purchases of hardware. Recurring revenue is up.

Hasn't Cisco been moving towards a recurring revenue model for the last couple of years? Meraki was the start of the recurring revenue model. Hasn't turned the tide yet.

Also Cisco is giving a higher dividend back to shareholders.

Yeah, at the cost of cutting Operational Expenses, i.e. head count.

Trump has also indicated he might do some sort of cash repatriation deal.

Cisco could bring that money back to the US at any time and pay taxes just like you & I have to do. Taxes are a fact of life, unless you're rich. Why not use that money instead of cutting people and making the rest work harder? My old team is struggling with the same work load and 20% less staff. And less qualified staff at that.

Finally Cisco's share of revenue from security products is up. Actually its not all doom and gloom.

So why are they making cuts in a profitable business unit?

That said most posters on this site are so depressed and angry with Cisco (although not so depressed and angry they will get off their huge yank arses and leave) they wouldn't believe the company was doing OK if the corridors were paved with gold and our pay checks had half a dozen extra noughts on them.

Being angry is a natural reaction to being treated like dirt. ELT keeps talking about the Cisco family, yet would rather cut costs by getting rid of older, more expensive workers instead of the poor performing workers who aren't worth keeping because it saves more money. And the corridors are covered in worn out stained carpets and cubicles whose fabric pattern was the trend of the '90's. Not exactly "gold".

Regarding year and bonus - the last I heard was that unless something dramatically changes in Q4 (seems that Q3 is already lost), year-end bonus won't be paid at all. Technically, they'll call it that they are paying 25% of the target (out of Chuck's good-will of course), which then they offset with the midyear advance, leading to the final payment of big fat zero. We will see how this plays out, but if anyone is holding on getting a new job because of year-end PL&I, you may want to revisit this strategy

6kbo, Nice regurgitation of ELT talking points. The "depressed and angry" posters are right to be bearish on Cisco, no Russian or alien interventions needed. From, one of the many who got of their "yank arse" and left.

stock price took a nice bump in the past few weeks. Take your profits and run. I wouldn't ride this thing back down to $28. The list of failing (not failed) projects is growing.

Cisco came in better than market expectations and that is reflected in share price. In addition Cisco is moving towards a recurring revenue model and away from one off purchases of hardware. Recurring revenue is up. Also Cisco is giving a higher dividend back to shareholders. Trump has also indicated he might do some sort of cash repatriation deal. Finally Cisco's share of revenue from security products is up. Actually its not all doom and gloom.

That said most posters on this site are so depressed and angry with Cisco (although not so depressed and angry they will get off their huge yank arses and leave) they wouldn't believe the company was doing OK if the corridors were paved with gold and our pay checks had half a dozen extra noughts on them.

So the alternative theory for why the share price is going up is that its all a conspiracy by the Russians with possible alien intervention and we are all dooooooooooomed. Oh and we are all going to be LR'd. With no staff the balance books look great!

Personally I go with the first version.

Mid year bonus traditionally paid out 50% of your target but this year that's dropped to half, so technically half of half or 25% of target, where applicable, before usual taxes etc. Full bonus might still be paid later on but the omens aren't good just now. It's better than no bonus though, right?

The mid year bonus wasn't paid out?

He has a point. If you're an awesome engineer fresh out of college who are you going to go work for, Cisco a tech dinasour run by sales people with declining market shares and the likelyhood you would get canned when some project your workin on loses the interest of the ELT or someone actually innovating like the companies Cisco is always trying to buy to stay relevant.

World class? Who talks like that? Your so full of sh!t. Have a nice life you world class wanker!

Congratulations on your world class post.

Don't ever use a stock price as an indicator of a business' health!

The stock is going up as Chuck has made it clear to the market that shareholder value is the most important thing over anything. Of course investors lap this up as they most look for short to medium term returns. It also helps that the dividend is one of the highest yielding and it keeps increasing. However, remember shareholders can sell and walk away at any moment they do not care about the long term success of the business.

The big issue is that to keep delivering shareholder value with declining revenues and margins, they need to remove cost and investments elsewhere. Initially this won't have too much impact but In the long term what it is doing will hit Cisco hard!

Cisco's only hope is that there is another transition in tech that they can build another monolpoly on, but given they cant hold on to or hire any world class engineers now, I doubt they would succeed even if they spotted one.

Numbers are adjusted as per the market expectation but that's not a reality. Big deficit on balance sheet & it will only inflate per quarter because of the lesser demand for cisco's expensive products. Early sign of big year end layoff to compensate the numbers.

LRs drive the stock price up.

I don't think so. That stock price is propped up by layoffs, budget restrictions, internal cuts, and lack of bonus payout. Doesn't sound 'great' to me.

@spp

You're right. This only means that thanks to Trump investors will get more dividends, and the share price is getting higher due to higher demand.

For info, many analysts say that Cisco shares are overbought. If you have some, then it' time to sell...

It just means the dividend is higher.....nothing more. Ask yourself if things were truly looking up, why was the bonus not paid as expected?