News: Networking giant reported a 2% decline in revenue for the July quarter.
Cisco has announced a restructuring plan that will see up to 5,500 job losses, representing approximately 7 percent of its global workforce.
Cisco will start implementing the restructuring plan from the first quarter of fiscal 2017.
The company said: “We announced a restructuring enabling us to optimize our cost base in lower growth areas of our portfolio and further invest in key priority areas such as security, IoT, collaboration, next generation data center and cloud.”
The company reported a 2% drop in its revenue to $12.6bn from $12.84bn in the quarter to 30 July.
However, it saw a 21% increase in profit for its fourth quarter ending 30 July. Its profit increased to $2.81bn in the May-July quarter compared to $2.3bn in the corresponding quarter last year.
Cisco CEO Chuck Robbins said: "We continue to execute well in a challenging macro environment. Despite slowing in our Service Provider business and Emerging Markets after three consecutive quarters of growth, the balance of the business was healthy with 5% order growth.”
“Our product deferred revenue from software and subscriptions grew 33% showing the continued momentum of our business model transformation."
While it witnessed 12% fall in revenue from its service provider video division, product revenue growth was led by security at 16%.
Switching product revenue increased by 2% and NGN Routing revenue was down 6%.
Cisco said that the increase in the product gross margin was mainly due to continued productivity improvements, the divestiture of the SP Video CPE Business, and to a lesser extent product mix, partially offset by pricing.
Overall, the company’s revenue saw an increase of 3% to $48.7bn in the fiscal year ending 30 July, while net profit rose 7% to $12bn.
Cisco executive vice president and chief financial officer Kelly Kramer said: "Our strong operational discipline has enabled us to drive growth and margin improvement as we continue to invest in key priority areas such as security, IoT, collaboration, next generation data center and cloud, while also delivering shareholder value."