Cisco’s layoffs stand out this year because they weren’t triggered by weak results. The networking giant announced the reduction of just under 4,000 roles, less than 5% of its roughly 86,200-person global workforce, on the same day it reported record third-quarter fiscal 2026 revenue of $15.84 billion, up 12% year-over-year and ahead of Wall Street’s $15.56 billion estimate. Adjusted earnings of $1.06 per share also beat the $1.03–1.04 analysts had expected.
CEO Chuck Robbins framed the cuts as a reallocation rather than a cost-cutting exercise, writing in a company blog post that competing in the AI era requires “focus, urgency and the discipline” to keep shifting investment toward the highest-value areas. CFO Mark Patterson echoed that on the earnings call, telling analysts the move was about realigning talent toward silicon, optics, security, and AI rather than pure savings. Notification letters went out to affected employees starting May 14, and the company is offering pro-rated fiscal-year bonuses, internal and external job placement support (which Cisco says has historically helped roughly 75% of participants land new roles), and a year of access to Cisco’s internal training and certification platform.
State-level WARN filings give a more granular view of where the cuts are landing. In California alone, Cisco disclosed 471 job eliminations: 236 in San José, 154 in Milpitas, and 81 in San Francisco, with software engineering roles forming the single largest affected group. The restructuring is expected to generate up to $1 billion in pre-tax charges, with about $450 million recognized in the fiscal fourth quarter and the remainder spread into fiscal 2027.
Cisco’s cuts also illustrate a broader theme industry trackers have flagged in 2026: AI investment and layoffs are increasingly happening at the same companies simultaneously. Meta, Snap, Block, Oracle, and Amazon have all announced AI-linked job cuts this year even as they ramp AI infrastructure spending, and outplacement firm Challenger, Gray & Christmas reported that U.S. tech companies announced 85,411 job cuts in just the first four months of 2026, a 33% increase over the same period a year earlier.