Splunk is cutting 7% of its staff, at least 500 employees, less than six weeks after Cisco agreed to acquire the software observability vendor, the company said Tuesday in a filing with the Securities and Exchange Commission.
“The changes we are announcing are not a result of our agreement with Cisco; they are the continuation of the important initiatives we’ve undertaken across Splunk for more than a year to align our resources and operating structure to deliver ongoing and incremental value for our customers,” Splunk CEO Gary Steele said Wednesday in a statement shared with employees.
This marks the second round of layoffs at Splunk this year. The company, which reported nearly 8,000 employees at the end of January, announced plans to cut about 4% of its workforce during the quarter ending April 30.
The job losses will once again largely impact employees in the U.S., the company said.
Steele described the continued reorganization effort as part of the company’s strategy to deliver durable growth and profitability. Yet, Splunk has “incurred net losses in each year since our inception,” the company said in its 10-Q filing with the SEC in August.
Splunk ended July with an accumulated deficit of $4.05 billion.
When Cisco inked a deal valued at $28 billion to acquire Splunk in September it said the deal would become cash flow positive and gross margin accretive within the first fiscal year after the deal closes, which is expected in Q3 2024.