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Cisco is positioning itself as one of the companies built to win from the artificial intelligence boom. But that shift is bringing pain for workers. Despite a record quarter, the tech giant is reducing thousands of jobs as part of a broader restructuring tied to where it sees future growth.The job cuts come as the company shifts more money and focus toward areas it believes will define the next phase of technology, including AI, security, silicon, and optics.“These investments are building from a position of strength — and focusing on the technologies and businesses that will accelerate our growth, deliver unmatched innovation to customers and partners, and define our future,” said Cisco CEO Chuck Robbins.And Cisco is not alone. Across the tech industry, companies are still reporting growth while moving money, workers, and capital into AI and other areas they believe will drive long-term returns. Keeping pace with AI infrastructure and advancements is expensive, as evidenced by the increase in capital expenditures reported alongside earnings of big tech companies.Cisco cuts thousands of jobsCisco CEO Chuck Robbins, during the company’s earnings release, said the company is making changes that will reduce its overall workforce in the fourth quarter by fewer than 4,000 jobs, representing less than 5% of its total employee base.Most notifications will begin on May 14 and continue globally, subject to local laws and regulations, Robbins noted in a Cisco blog post.More AI:Micron sits at the center of a red-hot chip rallyIBM CEO sends blunt message on AI and quantum computingAnthropic CEO makes shocking admission about AIThe company said affected employees will receive prorated FY26 bonuses and support in finding new roles, either inside or outside Cisco, through the company’s placement services.Cisco will also provide impacted workers with one year of access to Cisco U courses and certifications, including courses covering AI, security, and networking. Robbins said Cisco is making “hard decisions” about where it invests, how it is organized, and how its cost structure reflects the opportunity in front of the company.Robbins made a similar point in a CNBC interview with Jim Cramer, saying Cisco must move quickly as the market changes.“Given the speed at which the market is moving, we need to make a rapid reallocation of resources,” Robbins said. Robbins said he did not want AI to become the “excuse” for the cuts; the truth is that the company needs funding for silicon, optics, and more.He acknowledged that impacted employees may not understand if he says the move is about “cost reallocation” rather than “cost reduction.” But he also said reallocated funds will create jobs within the company, into which affected employees could potentially move.“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. I am confident Cisco will be one of those winners,” said Robbins.Clearly, Cisco is not framing the cuts as a response to weak demand. It is reducing roles to shift more resources toward business tied to the AI buildout.

Cisco’s stock is up 51% year to date.Shutterstock

Record revenue makes layoffs stand outThe timing of the cuts is notable because Cisco is coming off a strong quarter.Cisco reported a record Q3 2026 revenue of $15.8 billion, up 12% year over year. The company also reported GAAP net income of $3.4 billion, up 35%, while GAAP earnings per share rose 37% to 85 cents.The company’s total product orders rose 35% year over year, while networking product orders grew more than 50%.“Cisco is well-positioned as the critical infrastructure for the AI era, building on our technology leadership and customer trust, while innovating at the speed and scale that our dynamic world demands,” said Robbins in the earnings release.This made the layoffs stand out more, despite accounting for only 5% of the total workforce. The cuts come as the company raises expectations for its AI infrastructure business.The earnings showed that the company took $1.9 billion of AI orders in Q3 alone, with product mix balanced between Silicon One-based networking systems and optics. AI workloads require significant networking capacity, data movement, and security. Cisco is positioning its networking systems, silicon, optics, and security products as critical infrastructure for companies building and running AI systems.And this requires additional funding or reallocation of existing funds, which Cisco is doing to position itself for the next phase of the AI boom. However, for the affected employees, there is an immediate cost.Related: JPMorgan doubles down on stock market message for 2026

Generative AI such as ChatGPT and other LLMs can be helpful for dealing with anger issues. I give tips and insights on how to best use AI for this. An AI Insider scoop.

Bond traders are sending incoming Fed Chair Kevin Warsh a welcome aboard message that puts a bit of a kibosh on his plan — which reflects President Donald Trump’s persistent demands — to lower interest rates.Sure, the stock market has been racing to new exuberant highs even while the Iraq war is pushing oil, gas, and diesel prices to wallet-busting levels.As I’ve reported, bond traders, however, have been preparing for inflation risks since the war began in late February.And that preparation includes the possibility that the central bank will need to raise interest rates sooner than anyone, especially Warsh, expected.The CME Group FedWatch Tool raised the probability of a quarter-point rate hike this year to 50% on May 15, up from the previous day’s odds of 40%.The 30-year Treasury yield topped the 5% threshold this week, MarketWatch noted, and the benchmark 10-year yield hit the 4.5% mark May 15 for the first time since June 2025.  The two-year yield rose above 4% for the first time in 11 months.“Risk sentiment is being dented by a global rise in bond yields, driven by a combination of inflation concerns, expectations for central-bank hikes, and worries around government debt as countries look to cushion the impact of higher energy prices,” Angelo Kourkafas, senior global investment strategist at Edward Jones, told Bloomberg.Inflation data spooks bond tradersSince the Iran war began, American consumers, especially those with lower or fixed incomes, have seen high gasoline and utility prices strain their household budgets. Meanwhile, businesses juggle the energy shocks by passing some of the cost of goods and services onto their customers.The Bureau of Labor Statistics said the April Producer Price Index jumped 6%, the biggest year-over-year increase since 2022. The April Consumer Price Index also came in hot May 13, jumping to 3.8% on a year-over-year basis, outstripping workers’ earnings for the first time in three years and marking the highest inflation print since the post-pandemic recovery in May 2023.The headline CPI climbed 0.6% from March, while the core gauge excluding food and energy costs rose 0.4%.Energy prices soared 17.9% year over year, with gas prices up 28.4% and fuel oil prices up a whopping 54.3%.  The Bureau of Economic Analysis released the March 2026 Personal Consumption Expenditures — the Fed’s preferred inflation gauge — on April 30, showing an acceleration in headline inflation largely driven by energy costs.Headline PCE (year over year): 3.5%, up from 2.8% in FebruaryCore PCE (year over year): 3.2%, (excluding food and energy) up from 2.9% in FebruaryDespite rising energy costs fueled by the Iran war, U.S. employers added more jobs than expected for a second month, and the unemployment rate held steady in April at 4.3%, the Bureau of Labor Statistics reported.

Fed’s mandate requires a tricky balanceThe Fed’s dual mandate from Congress requires maximum employment and stable prices.Lower interest rates support hiring but can fuel inflation. This risks fueling further inflation, potentially leading to an inflationary spiral.Higher rates cool prices but can weaken the job market. This increases the cost of borrowing and further stifles economic activity.When will inflation settle down? Tony Welch, chief investment officer at SignatureFD, told TheStreet in an email that the inflation narrativehas clearly shifted.“What was once a tailwind for markets has become, at best, a neutral factor and, at worst, an emerging headwind,’’ Welch said. “Our key question is whether inflation settles back down as energy markets normalize or begins to spread more broadly through wages and consumer behavior.”Related: Fed drops rate-cut bombshellThe Federal Open Market Committee held the benchmark Federal Funds Rate steady at 3.50% to 3.75% during its April 30 meeting. Several regional Fed bank presidents have raised awareness of possible rate hikes.Warsh will preside as chair at the next FOMC meeting on June 18-19. His challenge will be deciding whether to push through a rate cut or continue the pause.Bond yields becoming “a bit unhinged”Economist Ed Yardeni, president of Yardeni Research, said in a note that bond market investors believe the Fed needs to play catch-up on inflation as Warsh takes over, CNBC reported.Bond traders are hoping that policymakers display a slant toward tighter monetary policyat the June meeting, the economist said.“The market is signaling that the current FFR is too low to curb inflation and may have to be hiked,” Yardeni wrote.SocGen’s Subadra Rajappa said the Iran war’s energy spike will complicate Warsh’s ability to deliver the lower rates he has championed and that President Trump has demanded.“I’m starting to get a bit concerned because bond yields definitely feel like they are getting a bit unhinged,” Rajappa told Bloomberg Television. “I think we should really be paying attention to the signals that we are getting out of the bond market.”Bullish calls on stocks will be challenged if Treasury 10-year yields hit 5%, a level that usually depresses price-to-earnings ratios, Lori Calvasina at RBC Capital Markets told Bloomberg Television.Related: BofA drops blunt warning about Fed rate cuts

At the MVP MMA weigh-ins, Ronda Rousey confirmed her Saturday fight with Gina Carano on Netflix will be her last bout in mixed martial arts after nearly a decade away.

TheStreet aims to feature only the best products and services. If you buy something via one of our links, we may earn a commission.Why we love this dealA comfortable place to sit and unwind, especially in the cozy summer sun, becomes a place to use over and over again without even thinking about it. Whether you’re having morning coffee on the patio, taking a break from the busy day, or enjoying a relaxing evening during sunset, having a comfortable and versatile chair that offers support for extended use can not only provide a quick, comfy spot but can also become part of your cozy daily habits, offering something to look forward to day after day. If you want to create a comfortable nook that’s all your own, the Tappio Papasan Rocking Patio Chair should be at the top of your list. Not only does it provide a plush place to sit, but the rocking features and the option to use the adjustable footrest also make it a versatile option for lounging after work, hanging out with friends, or taking a nap in the sun. This chair is on sale for just $99 at Walmart, saving shoppers $181. It’s important to note that there’s an additional $40 shipping fee.  Tappio Papasan Rocking Patio Chair, $99 (was $280) at Walmart

Courtesy of Walmart

Shop at WalmartWhy do shoppers love it?The handwoven rattan exterior is supported by a powder-coated steel frame, providing durability with a stylish design. The seat is designed in an egg-shaped form with a deep profile and a super-thick 5-inch cushion that runs through the seat and up the backrest, creating a consistent level of padding. The cushion is water-resistant, UV-resistant, and anti-pilling, with a high-elastic sponge filling. The seat can hold up to 330 pounds with a stable rocking frame that features noise-dampening silicone pads that also prevent floor scratches.  Related: Walmart’s bestselling 3-piece rocking chair patio set is just $47The extendable footrest offers a near-zero-gravity floating feel as you rock back and forth, providing a place to lie out and nap, or sit up and chat. Thanks to the powder coating, polyurethane rattan, and weather-resistant cushioning, this chair can be used both out on the patio and inside in your favorite reading nook. The cushioning can also be removed and double as a floor mat to lie out on the ground during sunny days, or it can be secured with the fixed ties to keep it in place on the chair. The chair measures 38.2 inches tall and 51.2 inches deep at the fullest extension of the footrest, and the cushion measures 29.5 inches wide and 49 inches long. The pros and cons of this dealProsMaterial: The weather-resistant PE rattan, powder-coated steel, and cushioning offer an easy option for indoor and outdoor use. Seating options: While you can get the beige one-piece set for $90, they also offer a two-piece and four-piece set at discounted prices. Adjustable foot rest: The foot rest can be pushed out farther to extend your legs, or pushed in to offer a more upright positioning. Cons Colors: They only offer black and beige, but the beige is the best deal. Shipping isn’t free: While shipping is $40, the chair is still a great price for a comfortable, multi-use option. One reviewer said, “This set looks more expensive than what I paid. It’s really gorgeous. I put it together in less than an hour, and part of that time was unwrapping the parts.”Another person said, “I ordered these online, and they look even better in person. They are very comfortable.”Shop more dealsTappio Outdoor Rattan Loveseat, $100 (was $160) at WalmartRadiata Double Papasan Rocking Chair, $260 (was $349) at WalmartRadiata Rocking Chair with Footrest, $109 (was $198) at WalmartWhether you need a cozy place to sit and have morning coffee or you want a comfortable option for long hours sitting out this summer, the Tappio Papasan Rocking Patio Chair is a great choice. The plush cushioning, weather-resistant features, and adjustable footrest offer support for lounging out or sitting up both indoors and outdoors. Shoppers can get this chair for $99 plus shipping at Walmart, saving $181 on the original price of $280.

WWE confirmed the six-woman tag on SmackDown — Ripley, Flair and Bliss vs. Cargill, B-Fab and Michin is now official for Saturday Night’s Main Event XLIV on May 23.

Strong leadership isn’t about tighter control—it’s about creating clear systems, defined ownership and measurable outcomes that empower teams to perform at a higher level with confidence and autonomy.