Cisco Cuts 4,000 Jobs to Fuel New AI Push

Cisco will lay off about 4,000 employees – roughly 5% of its workforce – as it rebalances spending toward high-priority growth areas tied to AI, despite posting a solid third quarter.

The company reported Q3 revenue of US$15.8bn, up 12% year over year. 

CEO Chuck Robbins called the performance “even more impressive” given intensifying competition, a rapidly changing market, and a global shortage of components critical to Cisco’s portfolio and customers’ AI buildouts.

“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,” Chuck says. 

“I’m confident Cisco will be one of those winners. This means making hard decisions – about where we invest, how we’re organised and how our cost structure reflects the opportunity in front of us.”

A shift toward strategic growth

Cisco says it will support employees affected by the cuts with placement services that have helped 75% of past participants secure new roles, either within the company or elsewhere. 

Laid-off employees will also receive one year of access to Cisco U, the company’s learning platform.

While reducing roles in some parts of the business, Cisco is increasing investment in what Robbins called “clear strategic” priorities: silicon, optics, security and employee AI usage. 

“These investments are building from a position of strength, and focusing on the technologies and business that will accelerate our growth, deliver unmatched innovation to customers and partners and define our future,” Chuck says.

The growing trend of AI regulations

The move follows major headcount reductions in 2024, when Cisco announced 4,000 layoffs in February and a further plan to trim about 5,600 roles in August. 

In total, approximately 12% of the company’s workforce at the time was impacted by last year’s actions, which Cisco framed as enabling investments in key growth opportunities and efficiencies.

More broadly, 2026 has already seen a surge in AI-linked workforce reductions across tech. 

Nearly 80,000 employees were laid off in the first quarter, with close to half of those attributed to AI and automation. 

The growing trend of AI regulations

The move follows major headcount reductions in 2024, when Cisco announced 4,000 layoffs in February and a further plan to trim about 5,600 roles in August. 

In total, approximately 12% of the company’s workforce at the time was impacted by last year’s actions, which Cisco framed as enabling investments in key growth opportunities and efficiencies.

More broadly, 2026 has already seen a surge in AI-linked workforce reductions across tech. 

Nearly 80,000 employees were laid off in the first quarter, with close to half of those attributed to AI and automation. 

Some industry leaders, however, caution that not all cuts are truly AI-driven. 

OpenAI CEO Sam Altman noted at the AI Impact Summit in India in February that there is likely some “AI washing” with companies attributing layoffs to AI that they might have made regardless, alongside real displacement from automation.