Cisco Beats Earnings Expectations, But Shares Fall on Cautious Margin Outlook

Cisco Systems reported strong quarterly results, beating earnings and revenue expectations for fiscal Q4 2026. The company posted record quarterly revenue of $17.3 billion, up 18% from a year earlier, with adjusted EPS of $1.22 beating forecasts by 4.27%. Networking remained the main growth engine, with product orders up 40% and networking revenue up 28%.

However, despite the strong quarter, Cisco's shares fell after hours as investors weighed in on the company's cautious margin outlook. Chief Executive Chuck Robbins attributed the results to a broader shift in the industry driven by the accelerating adoption of agentic AI, which is fueling a networking super cycle.

Cisco guided for fiscal 2027 revenue of $72.2 billion to $73.4 billion and adjusted EPS of $5.05 to $5.11, with AI infrastructure revenue expected to reach $7.5 billion. The company's stock now trades at a P/E ratio of 41.32, which may have amplified investor sensitivity to any cautious guidance elements.