Cisco Surges 15% After Blowout Quarter Fueled by AI Demand

CNBC reported Wednesday that Cisco shares leaped roughly 15% in after-hours trading. The networking giant beat Wall Street expectations on both earnings and revenue. The company also unveiled plans to eliminate nearly 4,000 positions this quarter.

Earnings Beat Sets the Tone

Cisco posted adjusted earnings of $1.06 per share against a $1.04 consensus. Revenue came in at $15.84 billion, topping the $15.56 billion analysts had forecast. That represents 12% year-over-year growth from the prior comparable quarter. Net income climbed to $3.37 billion, up sharply from $2.49 billion a year ago.

Cisco AI orders have become the centrepiece of the company’s growth story. Management disclosed $5.3 billion in AI infrastructure and hyperscaler orders received so far this fiscal year. The company raised its full-year AI order target to $9 billion from a prior $5 billion estimate. Full-year AI revenue guidance was lifted to $4 billion from $3 billion.

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Guidance Well Above Consensus

For the fiscal fourth quarter, Cisco guided for adjusted earnings of $1.16 to $1.18 per share. Revenue projections landed between $16.7 billion and $16.9 billion. Both figures came in well above what analysts polled by LSEG had pencilled in at $1.07 per share on $15.82 billion. Networking revenue alone rose 25% to $8.82 billion in the quarter, beating segment estimates. Security revenue held roughly flat near $2 billion.

Background: A Late Arrival to the AI Rally

Cisco had long trailed data centre peers during the AI spending surge. The stock spent years below its dot-com era peak before finally breaking through to a record late last year. Shares have added 33% in 2026, outpacing the Nasdaq’s 14% gain over the same stretch. If after-hours gains hold through Thursday’s open, it would represent Cisco’s largest single-session move since 2011.

Also Read: Nasdaq Outperforms as Tech Earnings Season Delivers Broad Beats

Job Cuts Tied to AI Restructuring

CEO Chuck Robbins announced the latest workforce reduction will begin May 14. The cuts affect fewer than 4,000 employees, below 5% of total headcount. Associated severance charges are expected to total $1 billion in pre-tax costs. Roughly $450 million of that will land in the fiscal fourth quarter. Robbins framed the reductions as necessary to redirect investment toward highest-demand areas. He said companies that win the AI era must show focus and cost discipline. During the quarter, Cisco also launched new switches and routers built around its next-generation processor. A new leaderboard rating generative AI models on cybersecurity robustness was also introduced.

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