Cisco Systems Inc. shares climbed in premarket trading on Thursday after the networking giant raised its fiscal 2026 forecast, signaling strong progress in tapping into the surging demand for artificial intelligence infrastructure.
The company, a global leader in networking and internet hardware, now projects annual sales of up to $61 billion for the fiscal year ending July 2026—about $1 billion higher than its earlier forecast and above Wall Street expectations. Cisco also lifted its earnings outlook, which similarly surpassed analyst estimates, boosting investor confidence that the company is well-positioned to benefit from the AI boom.
Cisco’s CEO, Chuck Robbins, emphasized the growing importance of secure networking solutions in the AI era, stating, “As customers move quickly to unlock the potential of AI, the need for secure networking has never been greater.” The company has been overhauling its chips and networking equipment to enhance connectivity across data centers and server clusters designed to handle complex AI workloads.
In a market that includes competitors like Broadcom Inc. and Hewlett Packard Enterprise Co., Cisco has strengthened its position by partnering with Nvidia Corp., leveraging the chipmaker’s expertise to expand its AI-focused product offerings.
The company expects earnings of $4.14 per share in fiscal 2026, excluding certain items—higher than the average analyst forecast of $4.05, according to Bloomberg data. For the second fiscal quarter ending January, Cisco projects revenue between $15 billion and $15.2 billion and adjusted earnings of about $1.02 per share, both exceeding market predictions.
In the first quarter, which ended October 25, Cisco reported an 8% revenue increase to $14.9 billion and earnings of $1 per share, slightly outperforming expectations. Notably, AI infrastructure orders from major cloud providers reached $1.3 billion during the period, up from $800 million in the previous quarter.
Following its $28 billion acquisition of Splunk Inc. in 2024, Cisco has been diversifying into security and observability software to strengthen its recurring revenue base.
“Cisco’s AI momentum hasn’t abated,” noted Bloomberg Intelligence analyst Woo Jin Ho, adding that even with the revised guidance, the company’s outlook “may still be conservative, with room for modest upside.”
Cisco’s shares have gained 25% so far this year, reflecting growing optimism around its transformation into a key player in the AI infrastructure ecosystem.
