Two technology giants succumbed to a sluggish U.S. economy Friday, announcing
layoffs and other cost-cutting measures that could impact a combined total of
Cisco Systems Inc. said its work-force reduction could affect 8,000
employees, including 2,500 to 3,000 of its 4,000 temporary and contract workers,
as well as between 3,000 and 5,000 full-time staffers. On the high end, about 11
percent of Cisco's existing base of 44,000 regular employees could be
Cisco said the cuts will come through voluntary attrition, layoffs and job
consolidation throughout 2001.
In connection with those cuts, the company anticipates a one-time charge of
$300 million to $400 million by the end of the fourth quarter of fiscal-year
2001. Cisco has also imposed a hiring freeze, and it plans to pull back on
travel and marketing expenses.
It was unclear at press time how many of Cisco's cable-technology-division
employees could be part of the work-force reduction. Cisco officials were not
immediately available for further comment.
Cisco president and CEO John Chambers said in a prepared statement that the
current economic slowdown is also beginning to emerge in other parts of the
world. 'We also now believe that this slowdown in capital spending could extend
beyond two quarters,' he added.
Chip-maker Intel Corp., meanwhile, lowered first-quarter revenue forecasts by
roughly 25 percent and announced that it would slash its rolls by 5,000 jobs, or
6 percent of its work force.
Intel rival Broadcom Corp. lowered its first-quarter projections earlier in