Cisco to Cut 4,000 Jobs in Massive Q4 Shake-Up Amid AI Push

Cisco has announced another round of layoffs as the networking equipment maker sharpens its focus on artificial intelligence (AI) and future growth businesses, even as the company reported record quarterly revenue and strong demand for its networking products.

The US-based company said it will cut nearly 4,000 jobs globally, representing less than five percent of its workforce, as part of a broader restructuring plan expected to cost up to $1 billion.

AI Shift Triggers Job Cuts

Announcing the decision, Cisco Chair and CEO Chuck Robbins said the company is repositioning itself for the AI era by redirecting investments into faster-growing areas such as silicon, optics, networking and cybersecurity.

“With this, we are making changes today that will result in the reduction of our overall workforce in Q4 by fewer than 4,000 jobs,” Robbins said in a post on Cisco’s website.

“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,” he added.

Cisco said most employee notifications will begin on May 14 and continue globally in accordance with local labour laws and regulations.

Support for Affected Employees

The company said impacted employees will receive support packages, including prorated FY26 bonuses, placement assistance and access to learning programmes.

Cisco said employees will receive one year of access to Cisco U courses and certifications covering AI, networking and security skills. The company added that its placement services programme has helped 75% of participants secure new opportunities.

Robbins acknowledged the decision was difficult but necessary as Cisco adjusts its cost structure and investment priorities.

Strong Q3 FY26 Despite Restructuring

The layoffs come alongside a strong financial performance. Cisco reported third-quarter revenue of $15.8 billion, up 12% year-on-year (YoY), while non-GAAP net income rose to $4.2 billion.

“In Q3, we once again delivered double-digit growth on both the top and bottom lines which exceeded the high end of our guidance, coupled with record non-GAAP operating income,” said Mark Patterson, CFO of Cisco.

Cisco also highlighted strong momentum in AI infrastructure demand from hyperscalers. The company said it has already secured $5.3 billion in AI infrastructure orders so far this fiscal year and has now raised its FY26 AI orders forecast to $9 billion from the earlier estimate of $5 billion. Cisco also increased its expected FY26 AI-related revenue target to $4 billion, up from the previous projection of $3 billion.

“Cisco delivered record quarterly revenue in Q3 and we saw very strong, broad-based demand for our products, demonstrating the relevance of our technology for connecting and securing AI,” said Robbins.

Networking product orders jumped more than 50%, while data centre switching orders grew over 40%, reflecting rising enterprise and AI-driven demand.

Cisco also declared a quarterly dividend of $0.42 per common share, payable on July 22, 2026, to shareholders on record as of July 6, 2026.