CSCO Stock Slips After-Hours Even As AI Equipment Demand Drives Q4 Beat

• Cisco posted fiscal fourth-quarter net income of $3.86 billion on $17.25 billion in revenue, topping Wall Street expectations.
• The networking giant secured $4 billion in artificial intelligence gear orders in Q4 alone, pushing its full-year AI order total to $9.3 billion. 
• Cisco expects AI orders to be meaningfully higher in FY27.

Cisco Systems Inc. (CSCO) delivered strong fiscal fourth-quarter earnings and raised its outlook on surging demand for artificial intelligence hardware, but its shares slid late on Wednesday.

The networking equipment supplier posted net profit of $3.86 billion, or $0.97 per share, for the quarter ended July 25. That represents a 51% surge compared to $2.55 billion, or $0.64 per share, recorded in the same period last year. Adjusted earnings came in at $1.22 per share, outpacing average analyst projections of $1.17 per share.

Quarterly revenue surged 18% year-over-year to $17.25 billion, beating consensus expectations of $16.83 billion, as per Fical.ai. The growth was primarily spearheaded by a 24% leap in hardware sales, while service revenues remained steady.

Hyperscalers Drive Demand

The earnings spike underscores a massive spending spree by tech heavyweights including Microsoft Corp. (MSFT), Alphabet Inc.’s Google (GOOG, GOOGL), and Amazon.com Inc. (AMZN), which are racing to build data center capacity to power generative AI applications.

Cisco logged $4 billion in AI infrastructure orders from hyperscalers during the fourth quarter alone. That brought the full fiscal year total to $9.3 billion, nearly double the $5.3 billion reported through May.

“It's the fastest-moving technology transition that we've ever seen," said Chief Executive Officer Chuck Robbins. "Most customers know that if they pause or slow down, they run the risk of being way behind." 

Robbins noted that current market momentum is unprecedented in recent company history, citing multi-decade high demand across enterprise tech refreshes, network security fortifications, and AI cluster builds. 

CSCO Stock: FY27 Outlook

Looking ahead, Cisco provided guidance that comfortably exceeded initial Wall Street targets for both its upcoming first quarter and the complete fiscal year 2027.

For the fiscal first quarter ending in October, Cisco anticipates adjusted earnings of $1.32 to $1.34 per share on revenue between $18 billion and $18.2 billion. These projections beat consensus estimates of $1 to $1.19 per share on $16.66 billion in revenue.

For the full fiscal year 2027, Cisco forecasts adjusted earnings in the range of $5.05 to $5.11 per share and total revenue between $72.2 billion and $73.4 billion. Both ranges top analyst projections, which had anticipated full-year adjusted earnings of $4.8 per share on $68.8 billion in revenue, according to Fiscal.ai.

CSCO Stock: Retail View 

Retail sentiment on Stocktwits was ‘extremely bullish’ with ‘extremely high’ message volumes. 

A user anticipated tons of price target upgrades following the strong earnings print. 

CSCO stock has gained nearly 59% year-to-date. 

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