Cisco lifts outlook on AI order strength

Cisco (CSCO) closed fiscal 2026 with fourth-quarter revenue of $17.3 billion, representing an 18% increase from the $14.7 billion recorded in the same quarter a year earlier. The performance reflected broad demand across the business and a notable contribution from networking products, which helped drive overall growth. For the full fiscal year 2026, Cisco (CSCO) generated revenue of $63.3 billion, underscoring the scale of its operations heading into the new fiscal period.

Net income in the latest quarter rose to $3.9 billion, or $0.97 per share, compared with $2.6 billion, or $0.64 per share, a year earlier. Total product orders in the fourth quarter increased 35% year over year, and were up 25% when excluding hyperscaler customers. Networking product orders were particularly robust, growing 40% year over year in the quarter, highlighting continued demand for Cisco’s core infrastructure offerings.

AI-related infrastructure emerged as a key driver in the period. Cisco reported that hyperscaler customers placed $4.0 billion of AI infrastructure orders in the fourth quarter alone. These orders brought total fiscal 2026 hyperscaler orders to $9.3 billion, indicating substantial large-scale investment in networking and compute infrastructure suited for AI workloads.

Cisco said it delivered approximately $4.0 billion of AI-related revenue during fiscal 2026. Looking ahead, the company expects AI infrastructure revenue to increase to about $7.5 billion in fiscal 2027. The anticipated step-up in AI revenue reflects the conversion of existing orders, including those from hyperscalers, into shipments and recognized sales as deployments progress.

For the first quarter of fiscal 2027, Cisco projected revenue between $18.0 billion and $18.2 billion. The company guided to GAAP earnings per share of $1.08 to $1.10 and non-GAAP earnings per share of $1.32 to $1.34 for the period. This outlook positions the new fiscal year to begin with revenue above the most recent quarterly level, supported by the backlog of infrastructure demand.

On a full-year basis, Cisco issued fiscal 2027 revenue guidance of $72.2 billion to $73.4 billion. Non-GAAP earnings per share for the year are forecast in a range of $5.05 to $5.11. The guidance implies growth from fiscal 2026 levels and incorporates the company’s expectations for rising AI infrastructure revenue, ongoing strength in networking, and continued order momentum.

The fourth-quarter jump in product orders, including a 40% rise in networking product orders, points to a solid demand environment entering fiscal 2027. Excluding the impact of hyperscaler customers, product orders still increased 25% year over year, indicating broad-based customer interest across segments. This order strength is important for future revenue conversion, given the lead times involved in delivering large-scale infrastructure projects.

Within this mix, hyperscaler AI infrastructure remains a prominent component, with $9.3 billion in orders accumulated over fiscal 2026. As these and other product orders are fulfilled, they are expected to influence the pacing of revenue recognition across upcoming quarters. Combined with the company’s detailed guidance ranges, these dynamics frame Cisco’s outlook as it navigates growing demand for AI and networking solutions in fiscal 2027.