‘Tech layoffs continue’: Cisco cuts jobs to invest in AI; What it means for employees

Cisco has announced plans to cut nearly 4,000 jobs, or about 5 per cent of its workforce, even as the company reported strong financial results. The move reflects a shift in strategy as the company increases its focus on artificial intelligence and cybersecurity.

The company said it delivered better-than-expected profit and revenue in its latest quarterly results, with executives highlighting record revenue and growth. However, it also confirmed that workforce reductions are part of efforts to adjust its cost structure.

Why Cisco is reducing jobs

Cisco said the layoffs are aimed at freeing up resources to invest in key areas such as AI and cybersecurity. The company is restructuring its operations to focus on future technologies that are expected to drive long-term growth. This approach is becoming more common across the technology sector, where companies are reallocating budgets towards AI development and digital security.

Strong results despite layoffs

The job cuts come at a time when Cisco is reporting strong performance. According to company statements, it has achieved record quarterly revenue and double-digit growth. This highlights a trend where companies continue to perform well financially while making workforce changes to align with future priorities.

Focus on cybersecurity investments

Cisco has said it will increase spending on cybersecurity, especially as it deals with ongoing security challenges. Reports indicate that vulnerabilities in its networking products, including routers and firewalls, have allowed unauthorised access in some cases. The company also experienced a data breach last year that affected customer information. By investing more in security, Cisco aims to strengthen its systems and reduce risks for enterprise customers.

Part of a wider trend in tech industry

Cisco’s decision follows similar moves by other companies. Firms such as Cloudflare and General Motors have also announced layoffs while increasing investment in AI. Industry experts say companies are shifting towards technologies that can improve efficiency and reduce long-term costs, even if it means reducing workforce size in the short term.

Executive compensation and company strategy

Cisco’s CEO, Chuck Robbins, highlighted the company’s focus on AI adoption across its operations. According to public filings, Robbins is expected to earn more than $52 million in compensation in 2025. The company has not indicated any changes to executive pay in relation to the layoffs.

What this means for employees and industry

The latest round of layoffs is part of a series of workforce reductions by Cisco over the past few years, including job cuts in 2024 and 2025.

For employees, this reflects a changing job market where roles are being reshaped by technology shifts. For the industry, it shows how companies are prioritising investment in AI and cybersecurity as key areas of growth. As businesses continue to evolve, workforce strategies are likely to remain closely linked to technological changes and market demands.