Despite reporting one of the best quarters in the company’s history, Cisco Systems Inc. (NASDAQ:CSCO) is restructuring its workforce to the tune of 4,000 jobs. However, CEO Chuck Robbins insists the move is a strategic “reallocation” to fuel expanding artificial intelligence (AI) infrastructure, rather than a traditional cost-cutting measure.
Fueling The AI And Silicon Boom
Driven by a massive surge in demand from hyperscalers, Cisco recently reported a record $15.8 billion in third-quarter revenue. Yet, the pace of the AI revolution required shifts in internal investments.
“We intentionally wanted to stay away from having that appear to be an excuse, because that’s not why we’re doing it,” Robbins told Jim Cramer on CNBC, regarding the workforce reduction. Instead, the move is designed to feed Cisco’s highest-growth sectors.
“What we have to do is we need more funding in silicon. We need more funding in optics, we need more funding in our AI solutions, and we need more funding in security,” Robbins explained.
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