Cisco Systems 2026 Q1 Earnings Beats Expectations, Net Income Rises 5.5%

Cisco Systems (CSCO) reported fiscal 2026 Q1 earnings on Nov 12th, 2025, delivering results that exceeded expectations. The company raised its revenue and EPS guidance for Q2 and FY2026, reflecting strong demand for AI infrastructure and networking solutions.

Revenue

Cisco’s total revenue surged 7.5% year-over-year to $14.88 billion, driven by robust performance across its product portfolio. The Total Product segment contributed $11.08 billion, with Networking leading at $7.77 billion. Security and Collaboration segments added $1.98 billion and $1.05 billion, respectively, while Observability generated $274 million. Services revenue totaled $3.81 billion, completing the diversified revenue mix.

Earnings/Net Income

Earnings per share (EPS) grew 5.9% to $0.72, outpacing the prior year’s $0.68. Net income expanded by 5.5% to $2.86 billion, underscoring improved profitability. The EPS growth aligns with the company’s strategic focus on AI infrastructure and operational efficiencies.

Price Action

The stock rallied 4.4% after hours following the earnings report, adding to its 9.64% monthly gain. Short-term post-earnings strategies showed mixed results, with a 1.5% average return over 30 days and 3.5% over 90 days, though risks from earnings disappointments persisted.

CEO Commentary

CEO Charles Robbins highlighted AI-driven growth, noting $1.3 billion in hyperscaler AI infrastructure orders and a $2 billion pipeline. Strategic priorities include scaling Silicon One chips and partnerships with NVIDIA and G42, positioning Cisco for a “strongest year yet.”

Guidance

Cisco raised Q2 2026 revenue guidance to $15.0–$15.2 billion (vs. consensus $14.6B) and FY2026 revenue to $60.2–$61.0 billion. Non-GAAP EPS guidance for Q2 and FY2026 stands at $1.01–$1.03 and $4.08–$4.14, respectively, reflecting confidence in AI and cloud adoption.

Additional News

1. Institutional Investment: Fox Run Management L.L.C. acquired $609,000 in Cisco shares in Q2, signaling institutional confidence.

2. Analyst Upgrades: Bank of America and UBS raised price targets to $85 and $88, respectively, following the guidance update.

3. Insider Sales: Executives sold 82,965 shares worth $5.56 million in 90 days, though insider ownership remains minimal at 0.01%.

The report underscores Cisco’s resilience in a competitive landscape, with AI and enterprise networking driving near-term momentum. Investors should monitor execution on AI infrastructure and Silicon One adoption to gauge long-term growth potential.