Cisco's AI Revenue Forecast Fails to Meet Investor Expectations

Cisco Systems has made an AI revenue forecast that has disappointed investors, projecting around $7.5 billion in sales related to the artificial intelligence data centre sector for its current fiscal year.

This is a conservative estimate, according to analysts, as Cisco secured over $9.3 billion in AI-related orders over the past 12 months.

AI sales are expected to contribute approximately 10% to Cisco's projected total revenue, which ranges from $72.2 billion to $73.4 billion for the financial year 2027.

Cisco's CEO Chuck Robbins characterized the AI sales guidance as 'a good, prudent guide for the year', citing non-linear orders that are massive in scale and usually placed well ahead of time.

Despite the underwhelming AI outlook, Cisco's projections for sales and profit in the first quarter exceeded analysts' expectations, with revenue expected to fall between $18 billion and $18.2 billion.