Is Cisco Systems a Buy After Its Latest Earnings Report?

详细摘要

After market close Thursday, Cisco Systems (NASDAQ:CSCO) delivered a beat-and-raise quarter, posting double-digit percentage gains in key fundamentals. It also notched new records…

After market close Thursday, Cisco Systems (NASDAQ:CSCO) delivered a beat-and-raise quarter, posting double-digit percentage gains in key fundamentals. It also notched new records in certain line items. So, given all that winning, the stock logically traded higher the following day, right?

Wrong. Investors, accustomed to robust growth and estimates-beating quarters from tech hardware companies, found several developments in the earnings report concerning. Meanwhile, events outside of the company's control were putting the hurt on industry stocks on Friday, and Cisco's shares fell by more than 6%. That's quite the dichotomy, so here's a look at where that places the stock just now.

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Both figures topped consensus analyst estimates, though not overwhelmingly. On average, Cisco-tracking pundits were modeling revenue of slightly over $18.1 billion, and adjusted earnings per share (EPS) of $1.32.

One of the primary drivers of the company's revenue growth was, unsurprisingly, the build-out of artificial intelligence (AI) compute capacity. On the bottom line, profitability was helped by a workforce reduced by layoffs.

In its earnings release, the company quoted CEO Chuck Robbins as saying that "Organizations are turning to Cisco for our trusted, market-defining technology and our expertise to help them scale, secure and optimize their environments for the agentic AI era."

"We are in the very early stages of a multi-year networking supercycle, and we're confident in our ability to continue capturing the multi-billion-dollar opportunity it represents for Cisco," he added.

That confident talk was backed by a guidance raise. Cisco management now expects full-year fiscal 2027 revenue of $74.8 billion to $75.8 billion; its previous…

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