Key Takeaways for Cisco Systems Stock as of August 2026
- Record Print: Cisco’s Q4 revenue hit $17.3B, up 18% YoY.
- FY27 Guidance Raised: Management guided fiscal 2027 revenue to $72.2B-$73.4B and non-GAAP EPS to $5.05-$5.11, implying ~15% top-line growth at the midpoint.
- AI Order Surge: Hyperscaler AI infrastructure orders hit $4B in Q4 alone, pushing the FY26 total to $9.3B (~4.5x FY25), and CFO Mark Patterson guided FY27 AI infrastructure revenue to $7.5B.
- Margin Discipline: CFO Mark Patterson tied a 210 basis point YoY drop in gross margin to a bigger 370 basis point drop in operating expenses as a percentage of revenue, pushing operating margin up to 35.9% from 34.3% a year ago.
Cisco’s guide points to 15% growth next year, but the mix between AI hyperscale and core enterprise tells the real story. See the full breakdown on TIKR for free →
Cisco’s Q4 Earnings Show a Networking Super Cycle Hitting Full Stride
Cisco Systems (CSCO) closed fiscal 2026 with a record fourth quarter, reporting revenue of $17.3 billion on August 12, up 18% year over year and above the high end of its own guidance. Product revenue jumped 24% to $13.5 billion, and non-GAAP earnings per share hit a record $1.22, up 23%. For Cisco stock holders who spent the last two years waiting on the AI infrastructure story to show up in the numbers, this was the quarter it finally did.
Total product orders rose 35% year over year, and hyperscale orders grew in triple digits. Four of the largest cloud providers each grew AI infrastructure orders by triple digits in the quarter, and Cisco took $4 billion in hyperscaler AI orders, bringing the fiscal 2026 total to $9.3 billion, 4.5 times the prior year. CFO Mark Patterson guided fiscal 2027 AI infrastructure revenue to $7.5 billion, up from $4 billion recognized in fiscal 2026.
That growth came without a proportional jump in expenses. Gross margin slipped 210 basis points year over year to 66.3%, pressured by higher hardware mix and memory costs, but operating expenses fell 370 basis points as a share of revenue. Patterson walked through the mechanics on the Q4 earnings call: “Gross margins on a year-over-year basis were down 2.1% but OpEx was also down 3.7% as a percentage of revenue, which then allowed us to move from operating margins dropping as a percentage of revenue from 34.3% to 35.9%.” That’s the leverage Cisco stock bulls have been waiting for: revenue scaling faster than costs even as the AI mix shifts toward lower-margin hardware.
Guidance for fiscal 2027 backs up the trend. Cisco expects revenue of $72.2 billion to $73.4 billion, implying 15% growth at the midpoint, and non-GAAP EPS of $5.05 to $5.11. Strip out the AI hyperscale revenue and the core business is still guided to grow 10%, more than double the company’s long-standing 4% to 6% long-term model. Networking orders grew 40% in the quarter, marking the eighth straight quarter of double-digit growth.
Security also turned a corner, growing 14% in the quarter as Splunk contributed sizable on-premise deals and firewall orders grew more than 30% for a second straight quarter. Enterprise product orders accelerated to 21% growth, and public sector orders rose 30%, with every geography and product category posting double-digit gains.
Cisco’s FY27 guide bakes in 15% growth with margins holding near 35%. Break down the AI mix yourself and see what’s driving it on TIKR for free →
TIKR’s $127 Target Prices Cisco Stock for Modest Upside Through 2030
TIKR’s mid-case model values Cisco Systems at $127 by July 2030, implying a total return of 2% from the current price of $124, or 1% annualized over four years.
That return profile leaves Cisco stock priced for stability rather than a re-rating, a modest premium for a name compounding double-digit earnings growth in the near term.
The target reflects a business scaling into an AI infrastructure cycle that’s still ramping: fiscal 2027 guidance points to double-digit revenue growth and operating margin near 35%, the kind of durable profitability the model already prices into Cisco’s long-term outlook. With hyperscaler AI orders already covering multiple years of build-out, the model’s modest near-term appreciation looks more like a floor than a ceiling.
Cisco stock trades near TIKR’s $127 mid-case target, leaving just 2% modeled upside through 2030. Run your own assumptions on TIKR for free →
Should You Invest in Cisco Systems, Inc.?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
