Next week, I start my new role as Cisco’s CEO. The past 90 days of my transition period have been as intense and inspiring as I expected, and I am even more excited about our next chapter.
As I said I would, I have spent most of the last few months listening to our employees, customers, partners and shareholders around the world. It is clear to me that we have the right vision, strategy and assets to lead our customers and the market for the next decade. I also see where we can and will prioritize and accelerate areas that are critical to our future success, make changes where needed, drive greater simplification and clarity in our business, continue our focus on operational discipline, and invest in our exceptional culture. I talked about these as my four focus areas 90 days ago, and while we’ve already made several decisions that reflect our commitment to move with speed in these areas, you will see more from us in the days, weeks and months ahead.
Today, we announced the sale of our SP Video customer premise equipment (CPE) business to Technicolor. Our entry into this market almost 10 years ago moved us from a tactical vendor to a strategic partner to our service provider customers. This market is moving extremely fast, and now is the right time for the right company, Technicolor, to drive the future of the SP Video CPE business and deliver what our customers and partners need going forward. You can read more detail on this here. With this move, we are prioritizing our investments to deliver on our strategy of video in the cloud, and will partner with Technicolor to position the CPE business and its employees for future success. This is a win for us, a win for Technicolor, and a win for our customers, partners and employees.
We also announced changes to accelerate our momentum in the Internet of Everything (IoE) and Cloud. We have incubated both of these businesses as standalone organizations, but we now have the opportunity to integrate them within our primary functions. To that end, we are moving IoE and Cloud engineering into our Engineering organization, IoE and Cloud services pieces into our services business, and IoE and Cloud sales into our worldwide sales team. These changes will allow us to scale these businesses as we see increased customer engagements globally.
We will continue to make decisions to prioritize our portfolio and our investments to accelerate our business. Part of this on-going prioritization is ensuring we have the right talent in the right places to drive our strategy and our growth in a very fast-paced market. Some functions and geographies across Cisco are making very focused changes to quickly re-align our investments to the top opportunities. A limited number of our employees will be impacted, but we will exit Q4 with our headcount up and, based on our current business assumptions, expect an increase in our headcount as we exit next fiscal year. It is our remarkable people who make everything happen at Cisco. We will treat our exiting employees with the respect they deserve and will continue to invest in our culture and talent to drive our success.
We have an incredible foundation to build upon, and we will combine the best of today with new innovation and investments to build the best future for Cisco, our partners and our customers. Given how quickly we and our markets are moving, I am committed to sharing openly and transparently what I am seeing and where we are going. As I officially assume the CEO role on Monday, I’ll share more detail on why I’m more confident than ever in our future. We are going to lead the market and it is going to be a fantastic ride.
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