Cisco’s stock fell in after-hours trading following the release of its fiscal fourth-quarter earnings report, even as the company delivered results that exceeded Wall Street expectations on multiple fronts.
The networking company reported revenue of approximately $14.7 billion for the latest quarter, representing an 18% increase from the year-earlier period. Net income surged 51% to $3.9 billion, or 97 cents per share, compared with $2.6 billion, or 64 cents per share, in the corresponding prior-year quarter. Looking ahead, Cisco provided revenue guidance for the current quarter of $18 billion to $18.2 billion, exceeding the $16.8 billion consensus estimate. The company also issued an earnings forecast for the current period and full-year guidance that both surpassed analyst expectations.
The decline in the stock price occurred despite analyst optimism heading into the report. Wall Street had grown increasingly bullish on Cisco entering the earnings announcement, with the stock advancing more than 60% year-to-date and approximately 8% during the month, driven by expectations that the company would capitalize on growing artificial intelligence infrastructure spending.
Cisco’s results indicated the company is indeed benefiting from increased AI-related demand. The company reported that hyperscalers—the major internet firms driving significant portions of AI infrastructure investment—placed $4 billion of infrastructure orders during the quarter, bringing the fiscal-year total to $9.3 billion. Cisco expects revenue from this customer segment to nearly double in fiscal 2027 to $7.5 billion, up from approximately $4 billion in the prior fiscal year.
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