Cisco Stock Falls Despite Beating Earnings Estimates Amid AI-Driven Rally

Cisco's stock took a hit in extended trading despite beating earnings expectations and delivering strong revenue guidance. The networking equipment maker reported adjusted earnings per share of $1.22, surpassing the $1.17 expected by analysts surveyed by LSEG.

The company's revenue reached $17.25 billion, compared to the $16.82 billion consensus estimate. Cisco's recent rally had already priced in a significant improvement in its AI prospects, making it difficult for investors to be impressed by the results.

However, the company's forecast that hyperscalers will nearly double their revenue to $7.5 billion in fiscal 2027 provides evidence of its growing role in the infrastructure buildout required to support increasingly sophisticated AI systems.