Bloomberg the Company & Products

Bloomberg Anywhere Login


Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.


Financial Products

Enterprise Products


Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000


Industry Products

Media Services

Follow Us

The Chart That Helps Explain Cisco's 6,000 Job Cuts

Don't Miss Out —
Follow us on:

(Corrects number of years in fourth graph.)

The news yesterday that Cisco Systems will fire 6,000 more employees - on top of almost 20,000 jobs it has cut over the past five years - comes as the company faces intense international pressure.

The source of much of it: Huawei Technologies, China's biggest maker of networking equipment, whose march across Asia, Africa and Latin America is cutting off opportunities for Cisco in regions the company used to cite as places ripe for growth, according to Michael Howard, principal analyst and co-founder of Infonetics Research.

There is plenty of bad blood between the two companies. Cisco has accused Huawei of anticompetitive practices such as selling below cost and stealing intellectual property. In 2012, the U.S. House Permanent Select Committee on Intelligence issued a report labeling Huawei and another Chinese firm - ZTE - risks to U.S. national security because of their ties to the Chinese government. While that has restricted both companies' business in the U.S., each has made substantial gains elsewhere, elbowing out Cisco in the process.

Over the past five years, Huawei has increased its global share of the $14.6 billion market for routers sold to telecommunications companies more than any other provider, according to Howard. ZTE has also gained share of that market at Cisco's expense.


Still, Cisco is the big dog in that market, and may always be. And Huawei and ZTE are effectively shut out of large contracts in the U.S., the world's biggest economy. But the companies' advances, including in Europe, highlight the threat Cisco faces abroad and which Chief Executive Officer John Chambers has blamed for weighing on the company's results.

Huawei and ZTE's presence is most acutely felt in China, the world's largest Internet market, where they are the preferred suppliers to many companies and government agencies.

Cisco spokesman John Earnhardt emphasized Thursday that the company is cutting in some areas so it can add in others, and that the net headcount year-over-year won't change. Cisco's total headcount is up over the past five years by about 8,000 people. He declined to comment on competitors. In 2004, Cisco dropped its patent-infringement lawsuit against Huawei after the Chinese company agreed to change parts of its products' source code to address Cisco's complaints.

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.