Technology giant Cisco is eliminating fewer than 4,000 positions, representing approximately 5% of its total workforce. This move comes despite the company reporting higher-than-expected profit and revenue in its fiscal third quarter. The networking equipment manufacturer stated that it is reducing its headcount to adjust its “cost structure” and redirect resources toward artificial intelligence and cybersecurity initiatives.

Cisco’s decision aligns with a broader industry trend where tech companies increasingly cite a focus on AI spending as justification for workforce reductions. Recent examples include Cloudflare and General Motors, both of which conducted layoffs despite reporting strong financial results. Cisco plans to increase investment in cybersecurity, as the company continues to address numerous security vulnerabilities in its routers and firewalls. These vulnerabilities have enabled hackers to breach networks of corporate clients, including the U.S. government. Additionally, Cisco experienced a data breach last year that compromised customers’ personal information.

In a blog post published Wednesday, Cisco’s chief executive Chuck Robbins highlighted the company’s “record revenue” and “double-digit growth,” while acknowledging strategic investments “in our employees’ use of AI across the company.” According to public filings, Robbins was slated to earn over $52 million in executive compensation during 2025.

This marks the latest round of job cuts at Cisco in recent years. The company laid off thousands of employees during two separate rounds in 2024 and eliminated 150 positions in 2025.