SAN JOSE, Calif. — Two years after launching a controversial foray into selling hand-held gadgets to consumers, Cisco Systems said Tuesday it will close its Flip video-camera business and cut 550 jobs, as it turns its focus back to selling networking gear and other tech products to businesses and public agencies.
Cisco also said it will “realign” other consumer-product segments, including home video- conferencing systems and home routers, by folding some of them into divisions that sell similar equipment for business use.
San Jose-based Cisco announced the changes a week after chief executive John Chambers told analysts and the company’s 72,000 employees that he would be making difficult but “targeted” decisions to get the tech giant back on track, after a series of disappointing financial reports left Cisco’s stock wallowing at two-year lows.
Cisco may announce additional changes in coming weeks, according to spokeswoman Karen Tillman, who said she could not elaborate.
Tuesday’s news was generally applauded by Wall Street analysts, including several who had argued the company spread itself too thin by expanding beyond its core networking business.
Gleacher & Co. investment analyst Brian Marshall called the announcement “a step in the right direction.” Still, Marshall said the changes announced Tuesday are unlikely to have a major impact on Cisco’s finances as a whole. The company says consumer products represent about 2 percent of its business.
