Cisco Shares Plummet 6% as Margin Pressure Wipes Out $30 Billion

Cisco Systems, Inc., (NASDAQ:CSCO) shares plummeted 6% in premarket trading on August 13, 2026, wiping out nearly $30 billion from its market capitalization.

The decline was despite the company's announcement of record quarterly revenue, which rose 17.6% to $17.25 billion in the fiscal fourth quarter, surpassing analyst consensus of $16.82 billion.

Cisco also reported a strong demand for AI infrastructure, with hyperscaler orders totaling $9.3 billion in fiscal 2026 and projecting $7.5 billion in associated revenue for fiscal 2027, representing approximately 10.3% of overall revenue based on the midpoint of its guidance.

However, investors remain concerned about the company's gross margin trends, with adjusted gross margin dropping to 66.3% in the fourth quarter compared to 68.4% in the same period last year. The midpoint guidance for the first quarter stands at 65.5%, a further decline of 80 basis points.