Cisco Systems is cutting nearly 4,000 jobs as part of a major restructuring aimed at shifting more resources toward artificial intelligence (AI), even as the company reported stronger-than-expected earnings and record quarterly revenue.
The layoffs, announced as fewer than 4,000 roles globally (less than 5% of its workforce), are part of a broader strategy to reallocate investment toward high-growth areas such as AI infrastructure, cybersecurity, silicon, and advanced networking technologies.
In a statement and internal memo to employees, CEO Chuck Robbins said the restructuring reflects the company’s need to “focus on areas where demand and long-term value creation are strongest,” as the tech industry rapidly shifts toward AI-driven systems and cloud infrastructure.
Despite the workforce reduction, Cisco posted strong financial results, with revenue rising about 12% year-over-year to approximately $15.8 billion, surpassing analyst expectations. The company also raised its full-year outlook, citing continued demand from hyperscale customers building AI infrastructure.
Investors responded positively to the announcement, sending Cisco’s shares sharply higher in after-hours trading, with gains exceeding 15%, as markets reacted to both the earnings beat and the company’s stronger AI-driven growth forecast.
The restructuring is expected to cost the company up to $1 billion, largely in severance and related expenses, with charges spread across multiple financial periods.
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Cisco said the job cuts will begin rolling out globally, while hiring will continue in strategic areas aligned with its AI and cybersecurity priorities. The company has increasingly positioned itself as a key infrastructure provider powering the global AI boom.
The latest move reflects a wider trend across the technology sector, where firms are simultaneously reporting strong AI-driven revenue growth while restructuring workforces
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