Cisco to cut nearly 4,000 jobs to fund AI and security pivot

The networking equipment maker Cisco announced it is cutting nearly 4,000 jobs, representing around 5% of its total workforce. According to the company, the headcount reduction is intended to change its “cost structure” and allow it to invest in artificial intelligence and cybersecurity. This decision comes even as chief executive Chuck Robbins touted “record revenue” and “double-digit growth” during the company’s fiscal third quarter—which is its standard financial reporting period. In a blog post published Wednesday, Robbins acknowledged that Cisco was making strategic investments “in our employees’ use of AI across the company.”

Cisco’s restructuring mirrors a broader pattern among technology firms that are prioritizing AI spending while reducing headcount. Other companies, including Cloudflare and General Motors, have also recently laid off staff despite reporting strong financial results.

The company’s increased focus on cybersecurity follows a series of security challenges. Cisco is currently contending with a slew of security vulnerabilities in its routers and firewalls that have allowed hackers to break into the networks of its corporate customers, including the U.S. government. The company also previously experienced a data breach in which customers’ personal information was affected.

The job cuts also draw attention to executive compensation and Cisco’s recent history of downsizing. Public filings indicate that Robbins was slated to earn more than $52 million in executive compensation during 2025. The current reduction represents the latest in a series of layoffs at the company, which previously cut thousands of employees during two separate rounds of layoffs in 2024, and laid off over 150 employees in 2025.

Why it matters

Cisco’s move highlights a broader tech industry trend where companies are aggressively reallocating capital toward AI and cybersecurity, even while maintaining strong financial performance.