Cybersecurity firm Splunk, set to be Cisco's largest-ever acquisition, announced Wednesday it would lay off approximately 7% of its global workforce, months ahead of the deal close.
Splunk had nearly 8,000 employees as of January, according to its regulatory filings, meaning that around 500 employees will likely lose their jobs. The company laid off about 300 employees earlier this year.
Splunk CEO Gary Steele said the firings "are not a result of our agreement with Cisco" in a letter to employees that was filed with the U.S. Securities and Exchange Commission.
Most of the laid-off employees are located in the U.S., according to a concurrent filing with the SEC, and will receive unspecified severance and health-care packages. "Within the next 24 hours, each ELT member will communicate with their organization to summarize any changes to their teams," Steele wrote.
Splunk will incur about $42 million in restructuring costs, with most occurring before the end of April 2024. The company declined to comment on which teams would be affected or the timing of the layoffs shortly after the acquisition announcement, and referred CNBC back to its SEC filing.
In September, Cisco announced it would acquire Splunk in an all-cash deal valued at $28 billion. The companies said the deal was expected to close by the third quarter of 2024.
Shortly after the announcement, Steele and Cisco CEO Chuck Robbins discussed the deal on a call with analysts. "Together, we will become one of the largest software companies globally," Robbins told analysts.
Layoffs have struck tech companies large and small over the past year. Companies such as Google and Microsoft have cut thousands of employees, while many venture-backed companies have become so-called "zombie startups."
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