Cisco said on Wednesday it would cut around 4,000 jobs and raise its annual revenue forecast after a sharp increase in artificial intelligence infrastructure orders boosted demand for its networking products.

The San Jose-based technology group said the restructuring would affect less than 5 per cent of its workforce and form part of a broader effort to redirect investment towards AI, security, silicon and quantum networking technologies.

Cisco’s shares rose more than 16 per cent in extended trading after the company increased its fiscal 2026 revenue forecast to between $62.8 billion and $63 billion, up from its previous guidance of $61.2 billion to $61.7 billion.

Chuck Robbins, chief executive, said in a message to employees that companies seeking to succeed in the AI market needed “focus, urgency, and the discipline to continuously shift investment toward the areas where demand and long-term value creation are strongest”. Robbins said most staff notifications would begin on May 14 and continue globally in line with local labour regulations.

Reuters reported that Cisco has secured $5.3 billion in AI infrastructure orders from hyperscale customers so far this fiscal year and has increased its full-year expectation to $9 billion from $5 billion previously. The company said networking product orders rose by more than 50 per cent in the third quarter, while data-centre switching orders increased more than 40 per cent year on year.

Cisco said the restructuring would cost as much as $1 billion, with about $450 million expected to be recognised in the fourth quarter and the remainder in fiscal 2027. The company employed about 86,200 people as of July 2025.

The company is expanding investment in internal AI systems, including its proprietary assistant CIRCUIT, which the company said recorded more than 8 million quarterly interactions from employees. During its earnings call, Robbins said Cisco had made Codex, developed with OpenAI, available across its product organisation to accelerate software development.

Cisco reported third-quarter revenue of $15.84 billion for the period ending April 25, exceeding analysts’ estimates of $15.56 billion, according to LSEG data.

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