Cisco shares jump 17% on AI infrastructure orders alongside 4,000 job cuts

TL;DR:

• Cisco shares surged 17% to a record high on Thursday — the biggest single-day gain in over two decades — after the company posted strong AI-demand-driven results and announced roughly 4,000 job cuts to redirect investment.
• The networking gear maker has taken $5.3bn in AI infrastructure orders from hyperscalers so far this fiscal year and raised its full-year order forecast to $9bn from $5bn previously.
• The fourth-quarter retrenchments would represent less than 5% of Cisco’s workforce, with the company saying it is strategically investing in silicon, optics, and security while reducing roles in some areas.

The reaction stretched Cisco’s near-$400bn market capitalisation by roughly $70bn in a day, and analysts at Melius Research framed the move bluntly: “Cisco feels a lot like Intel here, as the puck has gone to where CEO Chuck Robbins invested — rewarding the company for its custom silicon and optics.” The AI infrastructure cycle has elevated the networking-equipment incumbents alongside the headline GPU-supplier story.

The restructuring shape

The $1bn cost of the AI-focused restructuring is the cost-side commitment behind the order-book optimism. Cisco’s argument is that the workforce shift is from declining lines of business into silicon, optics, security, and internal AI deployment — not a uniform headcount reduction. The Melius analyst note framed continuing momentum as “a clear secular tailwind from AI inference”, which aligns with the broader narrative that AI workloads are shifting from training (concentrated on Nvidia GPUs) to inference (where networking and edge-compute economics matter more).

UK angle: enterprise-IT supplier story with AI-jobs sub-plot

For UK enterprise-IT buyers, the data point is that even infrastructure incumbents are restructuring around AI workloads. Cisco’s $9bn order-book guidance is concentrated in hyperscaler infrastructure spend — most of which lands in the US — but UK enterprises and public sector procurements running on Cisco networking gear are inside the same product roadmap. The AI-jobs angle is also pertinent: Cisco’s 4,000 cuts will inevitably include UK-based roles, and “redirected to AI investment” framing is the same language UK SMEs are hearing internally as their employers right-size for AI deployment.

Looking forward

Two things to watch. First, whether Cisco’s H2-2026 results show the same AI-order momentum, which would consolidate the analyst thesis that this is structural rather than a peak. Second, whether comparable announcements from Juniper, Arista, or Broadcom validate the inference-networking thesis specifically. The risk for Cisco is the same as for Intel in earlier cycles: the puck moves again, and silicon investment that paid off in 2026 may need to be repositioned in 2028.