[SEATTLE] Cisco Systems, the largest manufacturer of machines running computer networks and the Internet, has provided careful forecasts for the current fiscal year, even as sales from artificial intelligence (AI) projects begin to recover.
Revenues range from US$59 billion for the fiscal year held until July 2026 to US$60 billion, the company said Wednesday (August 13). Some analysts were looking for more than US$61 billion, which is in line with the average Wall Street estimate of US$59.5 billion.
The guidance assumes that current tariffs will remain until the end of 2026, Chief Financial Officer Mark Patterson said in a call with analysts. “We can help leverage our world-class supply chain team to mitigate the impact of tariffs when necessary,” he said.
The shares fluctuated in late trading after the report was released, rising about 1% after a previous decline. Cisco had grown 19% this year until the end.
Like many of our peers, Cisco is working to benefit from booming AI spending. The company said Wednesday it recognizes approximately US$1 billion in AI revenue for fiscal year 2025. Still, he said the region is becoming increasingly competitive. Companies such as Broadcom and Hewlett Packard Enterprise, which completed their acquisition of Juniper Networks last month, are looking to serve the same market.
In the fourth quarter, which ended July 26th, revenue rose 7.6% to US$14.7 billion. The profit was 99 US cents per share, excluding some items. This compares with an estimate of USD 14.6 billion in revenue and 98 cents in revenue, according to data compiled by Bloomberg.
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Federal operations should return to growth in the new fiscal year, chief executive Chuck Robbins said in a call. Technology companies have been working on changing government procurement through the Trump administration's cost-cutting efforts.
To spread Cisco bets, Robbins has bolstered the company's security and surveillance software by acquiring Splunk for USD 28 billion in 2024.
For now, Cisco has not seen the same surge in interest among AI-fuel investors with some high-tech peers, said David Bahnsen, chief investment officer of the Bahnsen group. However, the company “has a future growth play that they position very well,” he said.
The company said that AI infrastructure orders from large cloud providers exceeded US$800 million in the quarter. This is an increase from US$600 million in the last quarter.
Cisco Inc. will be playing a role in the UAE Stargate project, a Stargate company in the UAE, incorporating its partnership with Saudi Arabian AI company Humain. These Middle Eastern partnerships will increase in the second half of fiscal year 2026, Robbins said in a call.
Cisco will become a “core system provider” for training and operating AI software at scale, he said. Bloomberg
