Cisco Systems announced Wednesday that it is eliminating fewer than 4,000 positions, representing roughly 5% of its workforce, even as the company reported better-than-expected profit and revenue for its fiscal third quarter. The networking equipment maker framed the cuts as a strategic shift in its cost structure to prioritize investments in artificial intelligence and cybersecurity.
Record revenue amid workforce reduction
In a blog post, Cisco CEO Chuck Robbins highlighted the company’s “record quarterly revenue” and “double-digit growth” while confirming the job cuts. According to public filings, Robbins was slated to earn more than $52 million in executive compensation during 2025. A Cisco spokesperson did not respond to requests for comment on whether Robbins plans to reduce his own compensation in light of the layoffs.
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The company’s decision follows a broader trend across the technology sector, where major firms have increasingly cited AI spending priorities as justification for workforce reductions. Cloudflare and General Motors both conducted layoffs in recent days despite reporting strong financial results.
Cybersecurity investments and ongoing vulnerabilities
Cisco’s pivot toward cybersecurity comes as the company continues to address a series of security vulnerabilities in its routers and firewalls. These flaws have allowed hackers to infiltrate networks of corporate customers, including U.S. government agencies. Last year, Cisco also suffered a data breach that exposed customers’ personal information.
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The company plans to increase spending on cybersecurity products and services, aiming to strengthen its defensive capabilities and restore customer trust. This strategic realignment reflects the growing importance of security in an era of escalating cyber threats.
Broader industry context
This is not Cisco’s first round of job cuts in recent years. The company laid off thousands of employees during two separate rounds in 2024 and cut 150 positions in 2025. The pattern of workforce reductions despite strong financial performance has drawn scrutiny from analysts and employee advocacy groups, who question whether executive compensation structures align with workforce stability.
The layoffs also highlight a larger shift in the technology industry, where companies are reallocating resources from general operations to AI-driven initiatives. This trend raises questions about the long-term impact on employment and the nature of work in the sector.
Conclusion
Cisco’s decision to cut nearly 4,000 jobs while reporting record revenue underscores the complex dynamics shaping the technology industry today. The company is betting that investments in AI and cybersecurity will drive future growth, even as it reduces its workforce. For employees and industry observers, the move signals a continued prioritization of emerging technologies over headcount, a pattern likely to persist as competition intensifies.
FAQs
Q1: How many jobs is Cisco cutting?
Cisco is eliminating fewer than 4,000 positions, approximately 5% of its workforce.
Q2: Why is Cisco laying off employees despite strong revenue?
The company says it is restructuring its cost structure to invest more heavily in AI and cybersecurity, which it views as key growth areas.
Q3: Has Cisco conducted layoffs before?
Yes, Cisco laid off thousands of employees in two separate rounds in 2024 and cut 150 jobs in 2025.
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