CISCO

Cisco Systems Inc. and a reporter denied whispers that the company had leaked an
untrue layoffs number before announcing an actual restructuring Wednesday that was
much smaller.

A Tuesday evening report from news site CRN cited “multiple sources close to the
company” saying that Cisco CSCO, -0.78% would slash as much many as 14,000 jobs,
about 20% of the company’s workforce. Wednesday afternoon, Cisco instead reported
that it would cut about 5,500 jobs, in line with previous workforce changes the
company routinely announces at the end of its fiscal year.

As soon as the plan was reported, rumors began to circulate that Cisco had planted
the larger number in the press in an effort to ameliorate any negative effects from
the announcement.

In discussions and in an official statement Wednesday, Cisco denied any involvement
with the erroneous report, citing laws that would preclude such communications ahead
of an official disclosure.

“Cisco understands its disclosure responsibilities and refutes the suggestion,” a
Cisco spokesman said.

CRN reporter Mark Haranas also denied that the information came from Cisco, and
added that his report said that the cuts would come over the next few weeks,
suggesting Cisco could still add to its total beyond what was disclosed. An
editor’s note was added to the CRN story Wednesday evening noting the actual
number of disclosed cuts.

Cisco shares fell 1.3% in the regular session Wednesday, then declined a little
more than 1% in late trading despite beating earnings expectations with the
final quarterly report of its fiscal year.