AI-Driven Layoffs Surge: Cisco, Block, and Others Cut Jobs While Investing in Artificial Intelligence

Layoffs have been piling up recently, especially in the tech world. And the words "artificial intelligence" are accompanying more and more notices about the cuts. That’s unnerving workers across sectors, with many fearing what the rapid adoption of AI will mean for their job prospects. Even if AI isn’t replacing people directly, some businesses have announced reductions as they redirect money to the technology or tout new ways to streamline operations — raising alarm about what might be left over for payrolls and future openings.

But corporate explanations are often very vague. AI is rarely the sole reason companies cite when taking layoffs, with most still pointing to wider corporate restructuring or macroeconomic headwinds. Some executives have also suggested that, while they’re making cuts to move around resources now, AI and its demand could open up new roles down the road. Still, it’s hard to know if that’s the real driver or just the message a business wants to tell Wall Street.

Cisco

On Wednesday, Cisco Systems announced plans to cut under 4,000 jobs, or about 5% of its workforce. The announcement arrived the same day the tech giant unveiled record revenue for its third fiscal quarter, amid soaring demand for its AI tools and infrastructure. CEO Chuck Robbins told employees in a memo that "the companies that will win in the AI era will be those with focus, urgency, and the discipline to continuously shift investment" — and that meant "making hard decisions." But he said Cisco would also help employees impacted by the cuts find new opportunities, "whether internal or external."

Block

Financial services provider Block in February moved to lay off more than 4,000 of its 10,000 plus employees. And the parent of payment platforms like Square and Cash App was vocal about reconfiguring to capitalize on AI. "The core thesis is simple. Intelligence tools have changed what it means to build and run a company," CEO Jack Dorsey said in a letter to shareholders at the time. "A significantly smaller team, using the tools we’re building, can do more and do it better."

Dow

Not only tech companies have pointed to AI when initiating layoffs. In January, chemicals maker Dow, Inc. announced plans to cut about 4,500 jobs — as part of broader push to "streamline" operations. That included putting more emphasis on AI and automation.

Pinterest

Also in January, Pinterest said it would lay off under 15% of its workforce as the company pivots more of its money to AI. The image-sharing platform said the cuts were part of broader "transformation initiatives" — which included reallocating the company’s resources to AI-focused roles and prioritizing AI-powered products.

Lufthansa Group

Last fall, Lufthansa Group said it would shed 4,000 jobs by 2030 — pointing to the adoption of AI, digitalization and consolidating work among member airlines.

Cuts at Meta and other big names arrive amid broader AI ramp-up

While perhaps not explicitly mentioning or tying the technology to recent layoff announcements, a host of other big names — including Meta, Microsoft and Amazon — are also cutting thousands of jobs while investing billions of dollars toward AI. Meta, for example, plans to lay off about 8,000 workers, or about 10% of its workforce, starting next week. When announcing the cuts last month, the Facebook owner more broadly cited the need to offset certain investments and broader efficiency. Still, the move arrives as Meta continues to ramp up spending on AI infrastructure and highly-paid AI expert hires. And earlier this year, CEO Mark Zuckerberg said 2026 will be when "AI starts to dramatically change the way that we work."