Cisco to Lay Off 4,000 Employees, Prepares to Invest in AI!
Cisco has announced a major reduction in its workforce. The company is set to cut its headcount to facilitate increased investment in AI. The announcement regarding these layoffs coincided with the release of the company’s revenue report on Wednesday. Reports indicate that more than 4,000 employees are expected to be affected by this move. The company states that it intends to shift its focus toward Artificial Intelligence, and these layoffs constitute an integral part of that broader strategy. Let us explore this corporate move in greater detail.
The American tech giant, Cisco Systems, has decided to let go of 4,000 employees. According to a Reuters report, the company plans to reduce its workforce by 5%. The company aims to pivot its operations toward Artificial Intelligence. Following the announcement of a 5% reduction in its global workforce, the company’s shares surged by up to 20%. The San Jose-based tech giant stated that this move reflects its strategy to position itself for the AI era—a strategy that involves redirecting investments toward sectors exhibiting the highest demand and offering the greatest value.
Cisco CEO Chuck Robbins expressed his firm conviction that Cisco would emerge as one of the “winners”—companies capable of making tough decisions. “We are implementing certain changes today that will result in a reduction of fewer than 4,000 jobs—or less than 4,000 employees—in our total headcount during the fourth quarter.”
Just hours prior to announcing the layoffs, the company released its earnings report. The company reported earnings for the third quarter of fiscal year 2026 that significantly exceeded Wall Street’s expectations. The company’s revenue reached a record $15.8 billion, surpassing the projected figure of $15.56 billion. Meanwhile, adjusted earnings per share stood at $1.06, exceeding the forecast of $1.04. Revenue marked a 12% year-over-year increase, rising from the $14.15 billion recorded in the corresponding quarter of the previous year.
