Cisco reported strong numbers on Wednesday, but Wall Street wasn’t impressed. The networking giant beat expectations for both sales and profits, yet its stock price tumbled about 7% in after-hours trading. Investors seem focused on the company’s forecast for the coming months, which merely met analysts’ predictions rather than exceeding them.
For the recent quarter, Cisco brought in $15.35 billion in revenue, topping the $15.12 billion estimate. That represents a 10% jump compared to last year. Adjusted earnings came in at $1.04 per share, slightly ahead of the $1.02 forecast. Despite this solid performance, the market reaction shows just how high the bar is set right now.
Much of the pressure comes from the AI boom. Investors are desperate for Cisco to prove it can compete alongside high-flying chipmakers. The company is making progress there. CEO Chuck Robbins revealed that Cisco secured $2.1 billion in AI infrastructure orders from major tech companies during the quarter. The core networking business also saw a healthy 21% revenue increase.
To keep up with the AI wave, Cisco is teaming up with heavy hitters. The company announced a new networking switch powered by an Nvidia chip and is working with AMD on an infrastructure project in Saudi Arabia.
However, supply chain ripple effects still linger. Robbins noted that the skyrocketing demand for Nvidia’s graphics processors has driven up the price of memory components. This forced Cisco to raise its own prices and adjust contracts with partners. Looking ahead, Robbins expects revenue from newer cloud providers to ramp up later this year, but he tempered expectations regarding immediate financial impacts from government-led projects.
For the full 2026 fiscal year, Cisco projects revenue between $61.2 billion and $61.7 billion. While this implies decent growth of around 8.5%, it wasn’t enough to spark a rally for investors hungry for massive AI returns.
