Cisco shares surged 14% on May 14, 2026, marking their best day in over two decades, after the company exceeded its full-year order guidance and raised its AI infrastructure and hyperscaler guidance orders for the fiscal year from $5 billion to $9 billion [1]. CEO Chuck Robbins attributed this performance to soaring demand for artificial intelligence tools and equipment, which he described as powering the industry toward a 'networking supercycle' [1].
In response to the rapidly evolving market, Cisco announced it will cut about 5% of its workforce as it reallocates resources toward AI-focused segments, silicon, and optics [1]. Robbins noted that many of the affected employees may transition into new roles within these growth areas [1]. Despite previously lagging behind hyperscaler peers such as Nvidia in the AI race, Cisco has now surpassed its internet boom-era highs, as investors bet on the company's networking infrastructure essential for data centers and the expanding AI market [1].
Robbins emphasized the dynamic nature of the AI market, stating that while the company does not have complete visibility into forward bookings, it feels confident about its direction based on relationships, design wins, and capital commitments from hyperscalers [1]. Cisco has also opted out of some projects with hyperscalers, reflecting a selective approach to market opportunities [1].
Additionally, Cisco is participating in Anthropic's Project Glasswing, which recently allowed select businesses to test the model and assess its cybersecurity implications [1]. Concerns about potential risks and vulnerabilities have prompted businesses to accelerate security upgrades, with Robbins stressing the need for agility and readiness to adapt in this fast-moving environment [1].
CONCLUSION
Cisco's strong performance and optimistic outlook, driven by robust AI demand, have propelled its shares to record highs and signaled a significant shift toward AI-focused growth. The company's strategic workforce realignment and involvement in cutting-edge AI projects underscore its commitment to capitalizing on the expanding AI market. Investors responded positively, reflecting confidence in Cisco's ability to navigate and lead in the evolving technology landscape.