Cisco Beats Q3, Cuts 4000 Jobs to Fund AI Push; Stock Jumps 15%+
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- Cisco posted Q3 revenue of $15.84B, up 12% YoY and above the $15.56B Wall Street estimate
- Cisco raised its FY 2026 AI orders forecast alongside the earnings beat, citing surging cloud-provider networking demand
- Cisco is cutting fewer than 4,000 jobs — roughly 5% of its workforce per People Matters — as part of a restructuring toward AI, security, and silicon
- CSCO shares jumped 15%+ after the bell, with some outlets reporting gains up to 18%; Bloomberg called it the biggest single-day jump since 2011 and ZeroHedge framed it as the largest move since the dot-com era
- CEO Chuck Robbins published an internal letter on Cisco Blogs titled "Our Path Forward" addressing the layoffs and the strategic AI shift
- Cisco is offering affected employees free Cisco training as part of their separation, per The Register's headline
- The layoff-to-AI-investment tradeoff is the dominant cross-outlet frame, with TechCrunch, Moneycontrol, Tech Monitor, Business Insider, and CRN all leading with jobs cut to fund AI
Why it matters: Roughly 4,000 workers are losing their jobs while Cisco posts record revenue, and the market is rewarding the AI pivot with the stock's biggest single-day jump since 2011. Cisco is reallocating an estimated 5% of its workforce from existing operations to AI networking, security, and custom silicon — a bet that hyperscaler and enterprise AI infrastructure demand will more than offset the headcount it's shedding, with investors so far endorsing that trade decisively.
