Cisco Systems (NASDAQ:CSCO) Releases Earnings Results, Beats Expectations By $0.05 EPS

Cisco Systems (NASDAQ:CSCO) issued its quarterly earnings data on Wednesday. The network equipment provider reported $1.22 EPS for the quarter, topping the consensus estimate of $1.17 by $0.05, FiscalAI reports. The company had revenue of $17.25 billion during the quarter, compared to analyst estimates of $16.84 billion. Cisco Systems had a return on equity of 30.54% and a net margin of 20.95%.Cisco Systems’s revenue was up 17.6% on a year-over-year basis. During the same quarter in the previous year, the firm earned $0.99 earnings per share. 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 Stock Down 2.1%

Shares of CSCO stock traded down $2.38 during trading hours on Friday, reaching $111.09. The company had a trading volume of 8,708,558 shares, compared to its average volume of 23,666,877. The company has a market capitalization of $437.84 billion, a P/E ratio of 33.28, a price-to-earnings-growth ratio of 2.79 and a beta of 1.02. The stock’s fifty day simple moving average is $117.23 and its 200 day simple moving average is $99.00. The company has a debt-to-equity ratio of 0.40, a quick ratio of 0.81 and a current ratio of 0.92. Cisco Systems has a twelve month low of $65.75 and a twelve month high of $130.37.

Cisco Systems Announces Dividend

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

Trending Headlines about Cisco Systems

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

• Positive Sentiment: Cisco reported fiscal fourth-quarter revenue of approximately $17.3 billion, up 18% year over year, and adjusted earnings of $1.22 per share, exceeding Wall Street expectations of $16.84 billion and $1.17, respectively. Cisco Reports Fourth Quarter and Fiscal Year 2026 Earnings
• Positive Sentiment: AI-related demand remains the key growth catalyst: Cisco took $9.3 billion in hyperscaler AI infrastructure orders during fiscal 2026, including $4 billion in the fourth quarter, and expects $7.5 billion of AI infrastructure revenue from hyperscalers in fiscal 2027. Chuck Robbins Says AI Is Fueling a Networking Supercycle
• Positive Sentiment: Management’s fiscal 2027 guidance is above consensus, calling for revenue of $72.2 billion to $73.4 billion and adjusted EPS of $5.05 to $5.11. First-quarter guidance also exceeded expectations, reinforcing the AI-driven networking “supercycle” narrative. Cisco Forecasts Upbeat Annual Revenue
• Positive Sentiment: Several firms raised their targets following the results, including UBS to $138, Truist to $140, Wells Fargo to $150 and Rosenblatt to $165, with buy or overweight ratings supporting the recovery in sentiment.
• Neutral Sentiment: Cisco declared a quarterly dividend of $0.42 per share, payable October 21 to shareholders of record October 2. The dividend provides ongoing income support but is unlikely to be the main short-term trading catalyst.
• Negative Sentiment: The stock’s recent post-earnings selloff reflected investor concerns that gross-margin pressure from the AI networking ramp could limit the benefit of accelerating revenue. Cisco’s premium valuation also leaves less room for execution disappointments. Cisco Stock Falls on Margin Concerns
• Negative Sentiment: HSBC downgraded CSCO from Buy to Hold and reduced its price target from $137 to $120, signaling that some analysts believe much of the AI opportunity is already reflected in the share price.

Analyst Upgrades and Downgrades

CSCO has been the subject of several research reports. UBS Group increased their price objective on shares of Cisco Systems from $132.00 to $138.00 and gave the company a “buy” rating in a report on Thursday. JPMorgan Chase & Co. raised their target price on shares of Cisco Systems from $95.00 to $96.00 in a report on Monday, May 11th. Citic Securities upped their price objective on Cisco Systems from $90.00 to $130.00 in a research report on Friday, May 15th. KeyCorp raised their target price on shares of Cisco Systems from $130.00 to $135.00 and gave the stock an “overweight” rating in a research report on Thursday. Finally, New Street Research raised their price target on Cisco Systems from $82.00 to $122.00 and gave the company a “neutral” rating in a research note on Thursday, May 14th. One equities research analyst has rated the stock with a Strong Buy rating, fifteen have issued a Buy rating and seven have issued a Hold rating to the company. According to data from MarketBeat.com, the stock has a consensus rating of “Moderate Buy” and an average target price of $129.43.

Insiders Place Their Bets

In other news, EVP Thimaya K. Subaiya sold 7,127 shares of the stock in a transaction dated Tuesday, June 16th. The shares were sold at an average price of $119.91, for a total transaction of $854,598.57. Following the transaction, the executive vice president owned 140,857 shares of the company’s stock, valued at approximately $16,890,162.87. This trade represents a 4.82% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Charles Robbins sold 21,400 shares of Cisco Systems stock in a transaction on Friday, May 22nd. The stock was sold at an average price of $120.03, for a total transaction of $2,568,642.00. Following the completion of the transaction, the chief executive officer directly owned 637,085 shares of the company’s stock, valued at approximately $76,469,312.55. This represents a 3.25% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 31,134 shares of company stock valued at $3,739,000 in the last ninety days. Corporate insiders own 0.01% of the company’s stock.

Hedge Funds Weigh In On Cisco Systems

Several institutional investors and hedge funds have recently bought and sold shares of the business. First Commonwealth Financial Corp PA boosted its position in Cisco Systems by 0.9% during the fourth quarter. First Commonwealth Financial Corp PA now owns 13,656 shares of the network equipment provider’s stock worth $1,052,000 after purchasing an additional 128 shares during the period. Wealthedge Investment Advisors LLC grew its holdings in shares of Cisco Systems by 4.1% in the 4th quarter. Wealthedge Investment Advisors LLC now owns 3,432 shares of the network equipment provider’s stock worth $264,000 after purchasing an additional 136 shares during the last quarter. Silicon Valley Capital Partners increased its holdings in shares of Cisco Systems by 3.0% during the third quarter. Silicon Valley Capital Partners now owns 5,154 shares of the network equipment provider’s stock worth $353,000 after buying an additional 148 shares in the last quarter. Cutler Investment Counsel LLC grew its holdings in Cisco Systems by 2.4% during the 4th quarter. Cutler Investment Counsel LLC now owns 6,274 shares of the network equipment provider’s stock worth $483,000 after acquiring an additional 148 shares during the last quarter. Finally, Keebeck Wealth Management increased its holdings in shares of Cisco Systems by 1.9% in the third quarter. Keebeck Wealth Management now owns 8,054 shares of the network equipment provider’s stock valued at $551,000 after purchasing an additional 153 shares in the last quarter. Hedge funds and other institutional investors own 73.33% of the company’s stock.

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.