Bay Area tech giant Cisco to cut thousands of jobs after record revenue

Cisco announced another wave of mass layoffs on Wednesday, even as the Bay Area tech giant brings in record revenue and billions of dollars in profit. 

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According to a memo from CEO Chuck Robbins that was published on Wednesday, the company is slashing “fewer than 4,000 jobs,” which amounts to less than 5% of its workforce. Employees will be notified starting Thursday, Robbins said, and the company will assist laid-off employees in “finding new opportunities.” 

Though the company reported a record revenue of $15.8 billion in its latest third quarter report, Robbins said it is shifting more of its investments toward artificial intelligence.

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

Cisco’s restructuring plan, which includes severance and termination benefits, is expected to cost the company $1 billion, according to a U.S. Securities and Exchange Commission The cost will be divided up between roughly $450 million in the fourth quarter of the 2026 fiscal year and the rest in 2027, the filing shows.

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Cisco, which is based in San Jose, did not disclose which positions will be cut. California’s Employment Development Department told SFGATE that it has not received a WARN filing from Cisco as of Wednesday. The document is generally required by the state in the event of mass layoffs.

This week’s layoffs mark a continuing pattern at Cisco, with the company cutting jobs on the heels of blockbuster revenue reports. In August, approximately 221 Bay Area employees were laid off after Cisco announced its skyrocketing revenue. Cisco’s layoffs also reflect a broader trend across the tech industry, as companies are shifting investments toward AI while downsizing their workforce. 

Last week, the San Francisco-founded cryptocurrency company Coinbase announced that it plans to slash 14% of its workforce, or about 700 workers, in an effort to prioritize AI.