Cisco’s Stock Pops After Smashing Earnings—Thanks to $1.3 Billion in AI Orders

Cisco just dropped its latest earnings report—and investors are loving it. The company blew past expectations for both profit and sales in its fiscal first quarter, sparking a more than 7% jump in the stock after Wednesday’s closing bell.

So, how did the numbers stack up? Here’s the breakdown compared to Wall Street’s predictions:

• Adjusted EPS: $1 vs. 98 cents expected

• Revenue: $14.88 billion vs. $14.77 billion expected

Sales climbed 8% compared to the same period last year, while net profit also inched higher. This isn’t just a one-off: it’s the fourth quarter in a row that Cisco has posted growth, finally breaking a rough streak of declines tied to economic headwinds and slower government spending.

The real standout? Its traditional networking business. Revenue there surged 15% to $7.77 billion—way ahead of what analysts were looking for.

A big reason for the growth? AI. Companies are pouring money into AI-ready data centers, many loaded with Nvidia chips. Cisco’s riding that wave, recently rolling out a new Ethernet switch built with Nvidia’s tech.

And get this: the company revealed it’s sitting on $1.3 billion worth of AI infrastructure orders from hyperscale clients. That’s a huge number—and a clear sign its AI strategy is gaining serious traction.

“We’re becoming more relevant in AI every day,” said CFO Mark Patterson. He also highlighted a “multi-billion-dollar campus refresh cycle” that’s just getting started.

Looking ahead, Cisco’s guidance came in strong across the board. Next quarter revenue is forecast between $15 billion and $15.2 billion, easily topping estimates. Full-year sales and profit expectations also came in above what analysts had modeled.

But it’s not all smooth sailing. While networking is on fire, Cisco’s security and collaboration units are still struggling. Sales in both divisions fell short of expectations, reminding everyone that not every part of the business is thriving just yet.

Even so, shareholders have little to complain about: Cisco shares are up 25% so far this year, beating the Nasdaq’s gains.