Cisco Surges as AI Orders and Outlook Lift Shares

Key Moments

Cisco Systems shares jumped +16.5% in pre-market trading after reporting record quarterly revenue of $15.84 billion and adjusted EPS of $1.06, both above analyst expectations.
Year-to-date AI infrastructure and hyperscaler orders reached $5.3 billion, and Cisco lifted its full-year AI orders target to $9 billion from $5 billion.
The company announced a restructuring plan focused on AI, silicon optics, and cybersecurity, including nearly 4,000 job cuts and up to $1 billion in pre-tax restructuring charges.

AI Demand and Strong Quarter Propel Shares Higher

Cisco Systems (NASDAQ: CSCO) surged +16.5% in pre-open trading after the company posted results that beat expectations and raised its outlook. The networking company reported record revenue of $15.84 billion alongside adjusted earnings per share of $1.06, both exceeding Wall Street forecasts.

Guidance for the upcoming fourth quarter called for revenue between $16.7 billion and $16.9 billion, a range that stood roughly $900 million above analyst models. The stronger top-line outlook helped fuel a sharp rerating of the stock in after-hours and pre-market action.

Acceleration in AI Infrastructure and Hyperscaler Orders

Cisco highlighted a substantial pickup in artificial intelligence-related demand. The company reported $5.3 billion in AI infrastructure and hyperscaler orders year-to-date and increased its expected full-year AI orders to $9 billion, up from a prior target of $5 billion. The revised target represents approximately 4.5 times Cisco’s total AI infrastructure orders in FY2025.

Within that, AI infrastructure orders from hyperscalers reached $1.9 billion in the most recent quarter, compared with $600 million in the same period a year earlier. Year-to-date AI-related orders have already exceeded Cisco’s prior full-year target.

Metric	Current Period	Prior / Reference
Quarterly revenue	$15.84 billion	–
Adjusted EPS	$1.06	–
Q4 revenue guidance	$16.7 – $16.9 billion	~$900 million above analyst models
YTD AI infrastructure & hyperscaler orders	$5.3 billion	–
Full-year AI orders target	$9 billion	Previously $5 billion
Quarter AI hyperscaler orders	$1.9 billion	$600 million a year earlier
Expected pre-tax restructuring charges	Up to $1 billion	–
Planned job cuts	Nearly 4,000	–

Restructuring Targets AI, Silicon Optics and Cybersecurity

Along with earnings, Cisco introduced a restructuring initiative aimed at channeling more resources toward silicon optics, AI, and cybersecurity. As part of this shift, the company expects up to $1 billion in pre-tax restructuring charges and plans to eliminate nearly 4,000 positions.

CEO Chuck Robbins described the strategy as a deliberate repositioning toward higher-growth areas, stating: “The companies that will win in the AI era will be those with focus, urgency, and the discipline to continuously shift investment toward the areas where demand and long-term value creation are strongest. I’m confident Cisco will be one of those winners.”

CFO Mark Patterson reinforced the company’s AI ambitions by indicating it is “probably reasonable to expect” at least $6 billion of AI hyperscale revenue recognition in FY2027. The combination of aggressive investment in AI-related capabilities and a clearer monetization path further supported the stock’s upside reaction.

Supportive Market Backdrop and Macro Crosscurrents

The broader equity environment provided a constructive setting for Cisco’s move. U.S. stock futures traded higher on Thursday morning, with NASDAQ futures up +1.20% and S&P 500 futures gaining +0.58% to reach record levels.

At the same time, macroeconomic data remained challenging. April PPI rose to its highest level since 2022, and CPI reached 3.8%. These readings effectively wiped out expectations for Federal Reserve rate cuts in 2026 and increased the perceived likelihood of a rate hike by April 2027.

AI sentiment received an additional boost from news that the U.S. permitted select Chinese companies to buy Nvidia’s H200 chips, highlighting the continued strength of AI infrastructure spending.

From Legacy Networking to AI Infrastructure Contender

Cisco’s latest performance and outlook suggested to investors that the company may be evolving from a traditional networking vendor into a more central player in AI infrastructure. The stock’s sharp advance reflected growing conviction that the next stage of AI expansion could depend as much on networking and connectivity as on semiconductors.

If Cisco shares hold their pre-market gains through Thursday’s regular session, the move would represent the strongest rally for the stock since 2002.