RESEARCH TRIANGLE PARK – Cisco CEO Chuck Robbins says that a current round of layoffs going on at the technology giant are part of a strategy to improve “customer experience” and not one designed to cut costs.

“The first is that the restructuring that’s going on right now is first of all it’s not an OpEx [operations expense] reduction and we’ve – I’ve actually taken this issue and talked head on with our employees about what’s going on right now very directly,” Robbins told analysts in a conference call Wednesday evening to discuss Cisco’s latest earnings.

“And majority of this is part of the customer experience transition. If you look at what we’ve done relative to the software portfolio and how we’re building out these offers for our customers any great software company has a very successful customer experience organization.”

Cisco has cut some 500 jobs at its corporate headquarters in California. Cisco’s Customer Experience, or CX, group is the focus of the cuts.

The company operates one of its largest campuses in Research Triangle Park, and WRAL TechWire was told that cuts made locally would not be large enough to trigger a layoff notice to the North Carolina Department of Commerce.

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Cisco has some 5,000 employees in the Triangle.

Robbins said the cuts are being made under a new strategy being implemented by recently hired Maria Martinez.

“[I]f you’ll recall we brought in Maria Martinez from sales force back in May of this year and she has been putting together a strategy for how we need to be structured for the future, and this is actually just, it’s an unfortunate step that we needed to take in order to expeditiously get to where we need to be relative to dealing with the renewals and the lifecycle that our customers are going to want us to drive with them in this new portfolio,” Robbins told analysts.

“So that’s really the predominant driver for what’s going on right now. And again I’ve been very clear with our employees, we’ve been very open and transparent with them about what’s going on.”

The layoffs were reported last week by The Register, a U.K.-based business news website.

“Over the last several years, we have been transforming Cisco to deliver even greater value to our customers,” a Cisco spokesperson wrote The Register via email. “We continue to make decisions to ensure that our investments and resources are aligned with strategic growth areas of the business.”

How many workers are being hit and and at what locations was not disclosed.

However, Cisco also continues to hire.

“We have also moved quickly to open requisitions – our impacted talent may be eligible to apply for these newly-created CX roles where there is a skills match,” Cisco told The Register.

Cisco does have some 3,800 open positions, WRAL TechWire was told.

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On the earnings front, Cisco (Nasdaq: CSCO) shares climbed 3 percent in after-hours trading Wednesday after its financials exceeded Wall Street expectations across the board.

“We had a strong start to fiscal 2019 and we believe our opportunity has never been greater,” Robbins said in a statement. “Our customers are looking to Cisco as a trusted partner to help them operate in a multi-cloud world and to transform their businesses. Our strategy is working and we are well positioned with our growing and differentiated portfolio across multiple domains to bring our customers a more secure, automated and simple IT infrastructure.”

Cisco’s fourth straight quarter of revenue growth produced:

  • Earnings of 75 cents a share, up 23 percent year-over-year. That topped expectations of 72 cents.
  • Revenue climbed 8 percent year-over-year to $13.1 billion, which topped estimates of $12.87 billion
  • An earnings forecast of 72 cents met expectations
  • And forecast revenue of more than $12.8 billion topped estimates of $12.5 billion.

The full transcript of the conference call is available online.