US-based cybersecurity company Splunk has unveiled plans to reduce its global workforce by approximately 7 percent, a move that comes just months before its acquisition by global networking giant Cisco.
According to regulatory filings by Splunk, the company employed nearly 8,000 individuals as of January, suggesting that approximately 500 employees are likely to be affected by the layoffs. Earlier this year, Splunk had already laid off around 300 employees.
In a letter to employees filed with the US Securities and Exchange Commission (SEC), Splunk’s CEO Gary Steele explained the decision, stating, “As we work to finish FY24 and look ahead, we are taking this proactive and strategic step that further aligns our workforce to better enable Splunkers to meet the needs of our customers and partners while remaining sustainable and cost-effective.” Steele emphasized that these layoffs were part of ongoing initiatives undertaken over the past year to optimize the company’s resources and operating structure to provide continued value to customers.
Importantly, he clarified that these layoffs “are not a result of our agreement with Cisco.” Most of the impacted employees are based in the United States and will receive severance packages along with healthcare benefits.
Steele mentioned that each member of the Executive Leadership Team (ELT) would communicate with their respective teams within the next 24 hours to provide a summary of the changes. Splunk anticipates spending approximately $42 million in restructuring costs, with the majority incurred by the end of April 2024.
In September, Cisco had announced its intent to acquire Splunk for around $28 billion, a significant move in the realm of generative AI. The acquisition was expected to be finalized by the third quarter of 2024, indicating that these layoffs were not directly tied to the impending merger.