Cisco Systems (NASDAQ:CSCO) Announces Earnings Results

Cisco Systems (NASDAQ:CSCO) released its quarterly earnings results on Wednesday. The network equipment provider reported $1.22 earnings per share for the quarter, beating the consensus estimate of $1.17 by $0.05, FiscalAI reports. Cisco Systems had a net margin of 20.14% and a return on equity of 28.44%. The business had revenue of $17.25 billion for the quarter, compared to analysts’ expectations of $16.84 billion. During the same quarter in the previous year, the business posted $0.99 earnings per share. The firm’s revenue for the quarter was up 17.6% compared to the same quarter last year. Cisco Systems updated its FY 2027 guidance to 5.050-5.110 EPS and its Q1 2027 guidance to 1.320-1.340 EPS.

Here are the key takeaways from Cisco Systems’ conference call:

• Record fiscal 2026 results: Cisco reported Q4 revenue of $17.3 billion, up 18% year over year, with non-GAAP EPS up 23% to $1.22. Full-year revenue reached a record $63.3 billion, while EPS rose 14% to $4.33.
• AI and networking demand accelerated: Q4 product orders increased 35%, including triple-digit hyperscaler AI infrastructure orders and 40% growth in networking orders. Cisco expects hyperscale AI infrastructure revenue to reach $7.5 billion in fiscal 2027, supporting a 15% midpoint revenue-growth outlook.
• Demand was broad-based beyond hyperscalers, with enterprise orders up 21%, public-sector orders up 30%, and service-provider and cloud orders up 95%. Cisco also cited growing demand for campus networking, data-center infrastructure, security, and on-premise AI deployments.
• Gross-margin pressure is expected to persist as the company ships a higher mix of hardware and absorbs elevated memory costs. Q4 non-GAAP gross margin declined 210 basis points year over year to 66.3%, and fiscal 2027 guidance implies a slight gross-margin headwind despite operating-margin improvement.
• Cisco generated $5.4 billion in Q4 operating cash flow and returned $3.2 billion to shareholders through dividends and repurchases. Fiscal 2027 revenue guidance is $72.2 billion to $73.4 billion, with non-GAAP EPS of $5.05 to $5.11.

Cisco Systems Trading Down 7.6%

Shares of CSCO traded down $9.37 during trading hours on Thursday, reaching $114.52. 25,493,295 shares of the company traded hands, compared to its average volume of 23,523,176. The company has a quick ratio of 0.81, a current ratio of 0.92 and a debt-to-equity ratio of 0.40. Cisco Systems has a 12 month low of $65.75 and a 12 month high of $130.37. The company’s fifty day moving average price is $117.56 and its two-hundred day moving average price is $98.72. The company has a market capitalization of $451.35 billion, a price-to-earnings ratio of 37.22, a price-to-earnings-growth ratio of 2.71 and a beta of 1.02.

Cisco Systems Announces Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Wednesday, October 21st. Investors of record on Friday, October 2nd will be paid a $0.42 dividend. This represents a $1.68 dividend on an annualized basis and a yield of 1.5%. The ex-dividend date is Friday, October 2nd. Cisco Systems’s payout ratio is currently 54.55%.

Cisco Systems News Summary

Here are the key news stories impacting Cisco Systems this week:

• Positive Sentiment: Cisco reported fiscal Q4 revenue of approximately $17.3 billion, up 18% year over year, while non-GAAP EPS of $1.22 exceeded the $1.17 consensus estimate. Networking product orders increased 40%, and total product orders rose 35%. Cisco fiscal 2026 earnings release
• Positive Sentiment: AI infrastructure demand remains a major growth driver. Cisco received $4 billion of AI-related orders in Q4 and $9.3 billion for fiscal 2026, and expects AI infrastructure revenue to reach $7.5 billion in fiscal 2027. Cisco earnings call highlights
• Positive Sentiment: Management forecast Q1 fiscal 2027 revenue of $18.0 billion to $18.2 billion and non-GAAP EPS of $1.32 to $1.34. Full-year revenue guidance of $72.2 billion to $73.4 billion and EPS guidance of $5.05 to $5.11 also exceeded analyst expectations. Reuters Cisco outlook
• Positive Sentiment: KeyCorp and Morgan Stanley raised their price targets to $135 and maintained “overweight” ratings, while Rosenblatt lifted its target to $165 and upgraded the stock to “buy.” Analyst rating updates
• Neutral Sentiment: Cisco declared a quarterly dividend of $0.42 per share, implying an annualized yield of roughly 1.4%. This supports shareholder returns but is unlikely to be the primary near-term trading catalyst.
• Negative Sentiment: The strong results and guidance failed to clear already-high investor expectations after CSCO’s substantial 2026 rally. Analysts also highlighted squeezed gross margins, creating concern that AI-related growth may come with lower profitability. MarketWatch margin concerns
• Negative Sentiment: Reports also pointed to a services-revenue miss, adding to concerns about the quality and sustainability of Cisco’s growth. With a P/E ratio near 40, investors are demanding continued acceleration, leaving limited room for disappointment. CNBC Cisco earnings coverage

Analyst Ratings Changes

CSCO has been the subject of several research reports. Weiss Ratings raised shares of Cisco Systems from a “buy (b-)” rating to a “buy (b)” rating in a research report on Friday, May 29th. The Goldman Sachs Group boosted their price target on Cisco Systems from $116.00 to $125.00 and gave the stock a “neutral” rating in a research report on Wednesday, June 3rd. Piper Sandler boosted their target price on shares of Cisco Systems from $86.00 to $132.00 and gave the stock a “neutral” rating in a report on Thursday, May 14th. CICC Research raised their price target on shares of Cisco Systems from $96.00 to $125.00 and gave the company an “outperform” rating in a report on Monday, May 18th. Finally, Citic Securities increased their target price on shares of Cisco Systems from $90.00 to $130.00 in a research report on Friday, May 15th. Two analysts have rated the stock with a Strong Buy rating, fifteen have assigned a Buy rating and seven have issued a Hold rating to the stock. According to MarketBeat, Cisco Systems currently has an average rating of “Moderate Buy” and an average price target of $127.76.

Insider Activity at Cisco Systems

In other Cisco Systems news, EVP Thimaya K. Subaiya sold 7,127 shares of the business’s stock in a transaction dated Tuesday, June 16th. The shares were sold at an average price of $119.91, for a total value of $854,598.57. Following the completion of the sale, the executive vice president directly owned 140,857 shares of the company’s stock, valued at $16,890,162.87. The trade was a 4.82% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, EVP Deborah L. Stahlkopf sold 6,586 shares of the business’s stock in a transaction dated Friday, May 15th. The stock was sold at an average price of $117.31, for a total value of $772,603.66. Following the sale, the executive vice president owned 177,223 shares in the company, valued at $20,790,030.13. The trade was a 3.58% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 47,650 shares of company stock worth $5,668,823 over the last ninety days. 0.01% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Cisco Systems

A number of institutional investors have recently made changes to their positions in CSCO. Intesa Sanpaolo Wealth Management acquired a new position in Cisco Systems in the 4th quarter valued at $25,000. Jessup Wealth Management Inc bought a new position in Cisco Systems during the 4th quarter worth approximately $29,000. Swiss RE Ltd. bought a new stake in Cisco Systems in the fourth quarter worth $35,000. Quattro Advisors LLC purchased a new stake in Cisco Systems in the 4th quarter worth approximately $49,000. Finally, Birchwood Financial Partners Inc. purchased a new stake in shares of Cisco Systems during the 4th quarter valued at about $49,000. 73.33% of the stock is owned by institutional investors and hedge funds.

Cisco Systems Company Profile

Cisco Systems, Inc is a global technology company that designs, manufactures and sells networking hardware, software and telecommunications equipment. Its core business focuses on enabling enterprise and service-provider networks through products such as routers, switches, network security appliances and wireless systems. Over time Cisco has broadened its portfolio to emphasize software-defined networking, cybersecurity, cloud infrastructure and edge computing solutions that help organizations build and manage modern IT environments.

In addition to hardware, Cisco offers a growing range of software platforms and subscription services for network management, security, analytics and collaboration.