g'day mates!
Cisco Earnings Call today. Layoffs will be announced (prolly)
It is not whether an LR happens today but rather the toxic culture Cisco has become. Annual goals have shrunk to half-year goals. Sales got consolidated with a paycut. partner 360 is an unpopular, overly complex disaster that was the solution to a problem that never existed.
Cisco has gone all in on AI at the expense of their core strength which has eluded them for years now. They simply forgot that it was the people, specifically the ravenous horde of engineers, that made Cisco successful. Those engineers are being replaced by upskilled sales people because the ELT believes the magical AI genie can replace a CCIE.
The sad truth is that it can and it will. Not yet but the ELT has shifted their focus from long term profitability to value extraction. They are just pulling the meat off of a dead elephant.
reminder that Cisco exists to generate profits and returns for shareholders. Thats it. Stock valuations are forward looking. The stock price is a reflection of the predicted future earnings of the company. CSCO stock did not rise because Cisco had a good quarter or year (in the past) . CSCO rose because Cisco leadership showed that they are willing to engage in permanent, ongoing labor cost reductions (in the form of frequent LRs) and drive down wages (changing roles and compensation plans) in order to generate profits and returns for shareholders. The street loves that. Fewer employees and lower wages per remaining employee leads to great short term profits and creates an enormous amount of pressure inside the workforce. AI is used to surveille and monitor employees. AI is getting better at replacing tasks and complete jobs. The coveted CCIE is now an LLM (Deep Network Model) that was trained by long term cisco employees.
The Hunger Games have begun inside Cisco. Wage reductions have started. Its a race to the bottom and the ELT will squeeze every drop of profit out of the survivors while they train their AI replacements in real-time.