Cisco’s stock pops 14% as surge in AI infrastructure orders leads to increased guidance

Here’s how the company did in comparison with LSEG consensus:

• Earnings per share: $1.06 adjusted vs. $1.04 expected
• Revenue: $15.84 billion vs. $15.56 billion expected

Revenue increased 12% in the quarter ended April 25, from $14.15 billion a year earlier, Cisco said in a statement. Net income rose to $3.37 billion, or 85 cents per share, from $2.49 billion, or 62 cents per share, a year earlier.

For the fiscal fourth quarter, Cisco called for $1.16 to $1.18 in adjusted earnings per share on $16.7 billion to $16.9 billion in revenue. Analysts polled by LSEG were looking for $1.07 in adjusted earnings per share on $15.82 billion in revenue.

Cisco said it’s received $5.3 billion in artificial intelligence infrastructure and hyperscaler orders so far this year, and raised its expected orders for the fiscal year to $9 billion, up from $5 billion. The company said it expects revenue in that market for the fiscal year of $4 billion, up from a prior projection of $3 billion.

While Cisco has trailed many of its data center peers in the AI race, Wall Street has been rallying to the company’s story of late, pushing the stock to a record late last year, finally surpassing its dot-com high. The shares have continued to climb this year, gaining 33%, topping the Nasdaq’s 14% advance.

During the quarter, Cisco announced switches and routers that use its next-generation processor. The company also debuted a leaderboard for ranking generative AI models based on how their robustness against cybersecurity attacks.

Cisco’s networking revenue increased 25% to $8.82 billion, exceeding the $8.47 billion consensus among analysts polled by StreetAccount. Security revenue was flat at about $2 billion, compared to StreetAccount’s $1.99 billion consensus.

Executives will discuss the results with analysts on a conference call starting at 4:30 p.m. ET.

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