Cisco To Cut Nearly 4,000 Jobs, Boost AI Spending

Cisco said it is cutting nearly 4,000 jobs as it shifts more spending toward artificial intelligence, a move the company announced alongside what it described as record quarterly revenue.

The Silicon Valley networking giant disclosed the workforce reduction in connection with its latest earnings report, drawing immediate attention because the cuts come during a period of strong demand tied to AI-related infrastructure. Multiple outlets, including TechCrunch, CNBC, the San Francisco Chronicle, Fast Company, Network World and Business Insider, reported on the layoffs and the company’s push to prioritize AI.

Cisco, which sells networking hardware and software used by enterprises and data centers, has been positioning itself to capture more of the buildout happening as companies expand computing capacity for AI workloads. The company said its restructuring is intended to help direct resources toward that opportunity.

In reports on the announcement, Cisco’s leadership emphasized an “urgent focus” on AI, even as the company posted what it called record quarterly revenue. The juxtaposition of strong top-line results and large job cuts underscored how the company is reallocating money toward areas it sees as higher growth, including AI-related products and orders.

The development matters for two reasons: it signals how aggressively legacy tech suppliers are reshaping their businesses around AI, and it highlights that cost-cutting and hiring decisions may not track neatly with near-term revenue performance. For employees and communities where Cisco has a presence, the cuts represent a significant workforce reduction. For customers and investors, the announcement is a fresh indicator that Cisco intends to compete intensely in AI-focused networking and data center markets.

CNBC reported that Cisco shares jumped after the company highlighted surging AI orders and announced the layoffs. The market reaction reflected enthusiasm about Cisco’s AI momentum, while also acknowledging the company’s plan to streamline operations as it invests in new priorities.

Details about which teams or locations will be most affected were not included in the provided context, and the company has not publicly outlined a full breakdown here of the roles being eliminated. Business Insider reported on a memo related to the restructuring, describing it as AI-driven.

Next, Cisco will proceed with the restructuring it has laid out, including carrying out the job cuts and redirecting spending toward AI-related initiatives. The company will also face scrutiny over how quickly those investments translate into sustained growth and how effectively it supports customers as internal changes roll out.

Cisco’s announcement adds to a growing list of major tech companies making significant workforce moves while racing to secure a foothold in the AI economy.