Cisco cuts more serious than expected, sells factory to Foxconn

The Cisco jobcuts will be more extensive than analysts expected, it was revealed on Tuesday, with 11.500 jobs set to be culled, as the firm also announced the sale of its factory in Mexico to Taiwanese firm Hon Hai Precision industry, better known as Foxconn.
Last week it was reported that Cisco planned to lay off 7000 of its 73,408 workers by the end of August, with an additional 3000 leaving voluntarily, though that number has now increased to total a full 15% of Cisco’s workforce. The dramatic cutbacks are part of the flailing networking giant’s plans to cut annual expenditure by $1 billion.
That goal may be hard to reach in the short term, however, with the job cuts reportedly expected to cost some $1.3 billion over several quarters in pre-tax restructuring charges. The firm says it expects to incur around $750 million of those charges in the last quarter of 2011, which includes some $500 million to 2,100 workers said to be taking early retirement.
Selling its set top box making Juarez, Mexico factory to the Taiwanese means 5000 Cisco employees will be transferred to Foxconn, according to the firm.
Higher levels will also not be immune to the cuts, with 15% of executives at the level of vice president and higher expected to lose their jobs. Cisco says it will be notifying its North American employees in the first week of August.