He accused Germany of being "delinquent" in its payments to Nato, and said he would stick with the plan unless Berlin changed its course.
Mr Trump has long complained that European members of Nato should spend more on their own defence.
Germany's ambassador to the US said US troops were not there to defend Germany but defend transatlantic security.
Emily Haber added that Berlin had been informed of the plan.
Rumours of cuts were reported earlier this month by US media, amid rising tensions with its allies in the Europe's North Atlantic Treaty Organisation (Nato) under Mr Trump.
During a cabinet meeting, Mr Trump said: "So we're protecting Germany and they're delinquent. That doesn't make sense. So I said, we're going to bring down the count to 25,000 soldiers."
He has said that Nato members should no longer be relying so heavily on the US to shoulder the costs of maintaining the alliance.