Cisco’s Earnings Are Expected to Rise. Results Could Be a ‘Barometer of Enterprise Demand.’
Cisco Systems earnings could get a boost if demand for artificial intelligence infrastructure has continued to grow.
Cisco is scheduled to report fiscal first-quarter earnings after the stock market closes on Wednesday. Analysts surveyed by FactSet expect the networking company to report adjusted earnings of 98 cents a share on revenue of $14.78 billion. In the same period last year, Cisco posted earnings of 91 cents a share on revenue of $13.84 billion.
Analysts also expect Cisco to report networking revenue—the segment that brings in the most revenue for the company and includes gear used in AI data centers—to be $7.47 billion, an increase from last year’s $6.75 billion.
“Cisco’s presence snakes underneath the global tech world, meaning its results can be a decent barometer of enterprise demand,” Joe Mazzola, head trading and derivatives strategist at Charles Schwab, wrote on Wednesday. He added that when Cisco last reported earnings, it cited solid AI infrastructure orders from web companies, which is a category he believes will be closely watched Wednesday night.
Cisco CEO Chuck Robbins said in August that AI infrastructure orders they received from webscale customers in fiscal 2025 were more than double the company’s original target, “indicating a massive opportunity ahead as we lead the required architectural shift and build the critical infrastructure needed for the AI era.”
UBS analyst David Vogt is optimistic that Cisco will reap the benefits from growing AI infrastructure demand. He upgraded shares of Cisco to Buy from Neutral on Nov. 2 while raising his price target on the stock to $88 from $74.
“We expect FY26 revenue growth to exceed the 4% to 6% guide with continued strong growth in FY27 driven by AI strength as the company has secured over $2B in AI orders from webscalers while closing in on $1B in Enterprise/Sovereign related orders,” Vogt wrote.
Shares of Cisco have gained 22% this year, outperforming the S&P 500’s 16% rise. But even though there are those on Wall Street who are optimistic that increased demand will help boost Cisco’s financials, there are some who remain cautious as competition and the possibility of companies pulling back spending remain risks.
“A.I. remains a tailwind, but Street expectations may have gotten ahead of reality,” Raymond James analyst Simon Leopold wrote in a note on Nov. 3. He rates the stock as Market Perform without a price target.
Shares of Cisco were up 0.5% to $72.08 on Wednesday.
Write to Angela Palumbo at angela.palumbo@dowjones.com
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