On Wednesday, Cisco Systems announced impressivequarterly earningsalongside nearly 4,000 job cuts.
The dichotomy stemmed from the hardware and networking company’s embrace of a rapidly growing trend in tech: openly admitting that layoffs are due toAIadoption rather than poor performance.
“The companies that will win in the AI era will be those with focus, urgency, and the discipline to continuously shift investment toward the areas where demand and long-term value creation are strongest,” Cisco CEO Chuck Robbins told employees in apublicly shared email. “I’m confident Cisco will be one of those winners. This means making hard decisions—about where we invest, how we’re organized, and how our cost structure reflects the opportunity in front of us.”
With his announcement, Robbins follows in the footsteps of tech leaders includingBlock CEO Jack DorseyandSnap CEO Evan Spiegel, who made similar moves this year.
Robbins emphasized that the company will further invest in employees’ AI use throughout their jobs.
Meanwhile, employees will start getting notifications if they’ve been laid off on Thursday. Cisco says the job cuts make up less than 5% of its total workforce.
Shares of Cisco Systems Inc. (Nasdaq: CSCO) were up more than 16% on Thursday morning. The stock had already been trading at record highs this month.
Source: Fast Company
