Cisco Lays Off 4,000 Employees to Pursue Profits from AI
The artificial intelligence (AI) frenzy is truly reshaping the global technology industry landscape. Technology companies are no longer just competing to create new products but are also shifting massive investments into AI infrastructure to capitalise on the sharp rise in market demand.
Amid this trend, Cisco has announced a significant step in the form of terminating employment contracts for nearly 4,000 employees. This action is part of the company’s restructuring to focus more sharply on AI business and other new growth sectors.
The announcement was made by Cisco on Wednesday, 14 May 2026, local time. Alongside it, the company from San Jose, California, United States, also raised its annual revenue projection following a sharp increase in demand from hyperscaler companies.
Cisco CEO Chuck Robbins assessed that companies wishing to survive in the AI era must boldly shift investments to the most potential sectors. “The companies that will win in the AI era are those that are focused, move quickly, and are disciplined in continuously redirecting investments to areas with the greatest demand and long-term value potential,” said Robbins, as quoted from Reuters, Thursday, 14 May 2026.
Cisco stated that the company is now expanding investments in silicon technology, optics, cybersecurity, and the use of AI internally within the company. Meanwhile, some job positions in certain divisions are being reduced.
The layoffs by Cisco are estimated to cover less than 5 percent of the company’s total workforce. As of July last year, Cisco had around 86,200 employees worldwide.
The restructuring is estimated to cost up to US$1 billion or approximately Rp17 trillion. Of that amount, around US$450 million or approximately Rp7.65 trillion will be recorded in the fourth quarter, while the remainder will be charged to fiscal year 2027.
Although cutting employees, Cisco’s AI business is actually surging. The company revealed that it has received AI infrastructure orders from hyperscaler companies worth US$5.3 billion or approximately Rp90.1 trillion throughout the current fiscal year.
Cisco has even raised the full-year AI order target to US$9 billion or approximately Rp153 trillion, much higher than the previous target of US$5 billion or approximately Rp85 trillion.