After lots of rumors, the networking company Cisco announced today that it would indeed cut a large number of its employees. In a press release today, the company revealed it plans to lay of 6,500 team members or about 9 percent of its total workforce. Cisco said that of that number, about 2,100 will leave as part of a "voluntary early retirement program". Executives at Cisco are not immune; the press release states that the layoffs will include "approximately 15 percent of vice president level and above employees." Team members in the US and Canada along with other countries will be informed if they will be staying or going in early August. Today"s announcement, which still represents a large amount of Cisco"s total employee head count, is still smaller than rumors that were reported earlier this month that said as many as 10,000 team members might be cut.
Cisco says that due to the layoffs it will take some one time charges that are "not expected to exceed $1.3 billion over several quarters." About $750 million of those charges will be charged in the fourth quarter of the company"s fiscal 2011 year with the rest to be charged in Cisco"s 2012 fiscal year. In addition Cisco announced today that it will sell off one of its set-top box manufacturing plants set in Juarez, Mexico to Foxconn. That plant has 5,000 employees who will all become employees of Foxconn in the first quarter of 2012. No job losses are expected as a result of Cisco"s sale to Foxconn.