Key Points
- 01Cisco (CSCO) now expects about $18.1 billion in fiscal Q2 revenue, above Wall Street estimates
- 02Full-year fiscal 2027 revenue guidance has been raised to $74.8–$75.8 billion
- 03Q1 fiscal 2027 revenue rose 24% year over year to $18.5 billion
- 04Cisco (CSCO) sees $9 billion in FY27 AI infrastructure revenue from hyperscalers
Cisco raises sales guidance on strong AI-driven demand
Cisco Systems has increased its sales outlook, projecting fiscal second-quarter revenue of about $18.1 billion as demand for networking equipment tied to artificial intelligence continues to accelerate. The new forecast for the quarter ending in January tops analysts’ average estimate of $17.8 billion and is accompanied by a higher full-year revenue outlook. Cisco now expects fiscal 2027 revenue between $74.8 billion and $75.8 billion, signaling confidence that current momentum in networking and AI-related spending will extend through the year.
The decision to lift guidance underscores how AI workloads are driving new investment in networking infrastructure. Cisco described broad-based high demand for its technology across all geographies and customer markets, with particular strength in AI-ready offerings. The company also raised its full-year non-GAAP earnings per share guidance, reinforcing the view that growth in AI and networking can be delivered with strong profitability.
Strong Q1 results set the stage for higher outlook
Cisco’s upgraded forecasts follow a robust start to fiscal 2027. In the first quarter, the company generated revenue of $18.5 billion, an increase of 24% year over year. Management highlighted that this represented the strongest revenue and non-GAAP earnings per share growth rates in over 15 years, pointing to a significant upswing in customer spending. The performance provided a foundation for raising both quarterly and full-year targets.
Cisco reported that demand strength was not limited to a single segment or region, but spanned all major geographies and customer types. This broad-based growth supports its assertion that a multi-year networking upcycle is underway. The company also reported high operating margins and growth in both GAAP and non-GAAP earnings per share, indicating that revenue expansion is translating into improved profitability.
AI infrastructure becoming a larger revenue driver
AI-related infrastructure is playing an increasingly central role in Cisco’s outlook. The company raised its expectation for AI infrastructure revenue from hyperscale cloud providers to $9 billion in fiscal 2027, noting that this would be more than double the total for fiscal 2026. This guidance reflects orders for networking gear needed to support rapidly expanding AI data center workloads.
Cisco framed the current environment as the early stage of a multi-year networking supercycle, driven by organizations seeking to scale, secure and optimize their environments for the AI era. The updated revenue targets for both the second quarter and the full fiscal year, alongside the higher AI infrastructure revenue expectation, position AI networking as a key pillar of Cisco’s growth strategy. Together, these elements highlight how AI demand is influencing both near-term sales and longer-term financial goals.
Key Takeaways
- 01Cisco (CSCO)’s upgraded quarterly and full-year revenue guidance signals growing confidence that AI-driven networking demand will sustain elevated growth into fiscal 2027.
- 02A 24% year-over-year revenue increase in Q1 fiscal 2027 provided the operational backdrop that enabled Cisco to raise its financial targets.
- 03The expectation of $9 billion in AI infrastructure revenue from hyperscalers in fiscal 2027 highlights how AI data center build-outs are becoming a core contributor to Cisco’s top line.
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