Key Takeaways
- Cisco reported $17.25 billion in quarterly revenue, beating analyst expectations
- The company expects fiscal 2027 hyperscaler revenue to reach $7.5 billion
- Hyperscalers placed $9.3 billion in infrastructure orders during fiscal 2026
Cisco share fell in extended trading on Wednesday despite the networking company reporting better-than-expected quarterly results and issuing revenue guidance above analyst forecasts. Cisco reported adjusted earnings per share of $1.22 and revenue of $17.25 billion for its latest quarter, compared with analyst expectations of $1.17 and $16.82 billion.
AI infrastructure drives Cisco’s growth
Cisco expects revenue of $18 billion to $18.2 billion for the current quarter, well above the $16.8 billion average analyst estimate. The company also issued an earnings forecast above expectations and provided its outlook for fiscal 2027.
The results point to growing demand for Cisco’s networking infrastructure from large technology companies expanding their AI computing capacity. Hyperscalers placed $4 billion in infrastructure orders with Cisco during the latest quarter, taking their total orders for fiscal 2026 to $9.3 billion.
The company expects revenue from hyperscalers to reach $7.5 billion in fiscal 2027, nearly double the approximately $4 billion generated from this customer group during fiscal 2026.
The increase reflects the growing need for networking equipment as technology companies add computing capacity for AI systems. Cisco has been positioning its networking business to serve this expansion as demand for data center infrastructure increases.
The company’s latest figures also show broader improvement across its business. Revenue rose 18% from $14.7 billion in the same quarter a year earlier.
Net income increased 51% to $3.9 billion, or 97 cents per share, compared with $2.6 billion, or 64 cents per share, in the year ago period.
Cisco expands role in AI spending
Cisco entered the quarterly results with strong investor interest. Its shares had gained more than 60% in 2026 and about 8% during August before the earnings announcement, as investors anticipated that the company could benefit more directly from rising AI infrastructure spending.
The latest results provide further evidence of increased demand from hyperscalers. The $4 billion in infrastructure orders during the quarter represented a significant portion of Cisco’s activity with this customer group.
For fiscal 2027, Cisco expects hyperscaler revenue to reach $7.5 billion. That compares with about $4 billion in fiscal 2026 and indicates that the company expects AI-related infrastructure demand to remain a significant source of growth.
Despite the stronger results and outlook, Cisco shares declined in extended trading. The stock was down about 4.06% after hours at $118.85, compared with a regular session close of $123.88.
The company’s quarterly performance highlights the increasing connection between AI investment and demand for networking infrastructure. As technology companies continue expanding computing capacity, Cisco expects hyperscaler orders and revenue to become a larger part of its business.
The company’s revenue forecast of $18 billion to $18.2 billion for the current quarter also indicates that Cisco share could remain in focus as the company expects growth to continue beyond the latest reporting period.
