Cisco to cut nearly 4,000 jobs as company expands AI investments

The company said the workforce reduction, representing less than 5% of its employees, will begin in the fourth quarter of fiscal year 2026. Most notifications are expected to start on May 14.

Cisco reported record third-quarter revenue of $15.8 billion, up 12% year-over-year, alongside double-digit growth in profit. Shares rose sharply in extended trading after the company also raised its annual revenue forecast.

“The companies that will win in the AI era will be those with focus, urgency, and the discipline to continuously shift investment toward the areas where demand and long-term value creation are strongest. I’m confident Cisco will be one of those winners. This means making hard decisions – about where we invest, how we’re organized, and how our cost structure reflects the opportunity in front of us,” CEO Chuck Robbins said in a message to employees.

The company said it is “making clear, strategic investments,” describing the changes as part of efforts to “accelerate growth” and strengthen Cisco’s position in the AI sector.

“While we are reducing roles in some areas, we are making clear, strategic investments - particularly in silicon, optics, security, and in our employees’ use of AI across the company. These investments are building from a position of strength - and focusing on the technologies and businesses that will accelerate our growth, deliver unmatched innovation to customers and partners, and define our future,” Robbins added.

Cisco added that it has received $5.3 billion in AI infrastructure orders from hyperscale customers so far this fiscal year and raised its annual forecast for such orders to $9 billion.

Earlier Qazinform News Agency shared findings of a new report, which suggests that AI has not yet caused widespread job losses, although early signs indicate it may be affecting hiring for some younger workers.