Cisco posts best day since 2011

Cisco’s rally on Thursday was about more than a headline beat. The company told investors on May 13 that it had already taken $5.3 billion in AI infrastructure and hyperscaler orders in fiscal 2026 and raised that full-year target to $9 billion from $5 billion. Cisco also lifted its fiscal-year AI infrastructure revenue outlook to $4 billion from $3 billion, while guiding fourth-quarter revenue to $16.7 billion to $16.9 billion. (investor.cisco.com) Chuck Robbins then gave Wall Street the phrase it wanted. In a CNBC interview on May 14, Cisco’s chief executive said the industry was entering a “networking supercycle,” arguing that AI demand was no longer just about buying more compute. (investor.cisco.com) He tied the order surge to hyperscalers building out the plumbing around AI systems — switching, routing, optics and the movement of data between clusters and users. The stock response was immediate. Cisco shares closed at $115.53 on May 14, up 13.41% on the day, their best one-day move since 2011, according to CNBC and market data pages tracking the close. (investor.cisco.com) ### Why did investors react so strongly to a networking company’s quarter? Cisco reported fiscal third-quarter revenue of $15.8 billion for the period ended April 25, up 12% from a year earlier, with adjusted earnings per share of $1.06. Analysts polled by LSEG had expected $15.56 billion in revenue and $1.04 in adjusted earnings per share, CNBC reported. (cnbc.com) The guidance mattered as much as the quarter. Cisco forecast fourth-quarter adjusted earnings per share of $1.16 to $1.18 on revenue of $16.7 billion to $16.9 billion, above the analyst estimates CNBC cited of $1.07 and $15.82 billion. (cnbc.com) That suggested the AI-related demand was not confined to one strong quarter. ### What is Cisco actually selling into the AI buildout? Cisco’s own release pointed to several parts of the network stack. The company said total product orders rose 35% year over year, networking product orders grew more than 50%, campus networking orders rose more than 25%, and data center switching orders increased more than 40%. (investor.cisco.com) Robbins described that demand as tied to how AI systems are being deployed. In the CNBC interview, he said AI workloads are creating new requirements for interconnect and moving data, and he said the company had enough visibility into customer relationships, design wins and hyperscaler capital commitments to feel confident lifting its target. (cnbc.com) He also said Cisco had chosen not to pursue some hyperscaler projects, citing uneven visibility in a fast-moving market. ### Why does the phrase “networking supercycle” matter? Cisco has spent much of the AI boom in the shadow of Nvidia and other chip suppliers. (investor.cisco.com) Robbins’ formulation reframed the company’s role: not as the maker of the core training chip, but as a supplier of the systems that connect AI infrastructure together and move traffic across it. That framing matched Cisco’s statement that its technology is “critical infrastructure for the AI era,” though that characterization comes from the company itself. The numbers behind that framing were new enough to change investor expectations. Cisco said it had already reached its prior $5 billion AI order target with one fiscal quarter still to go, then nearly doubled the full-year goal. (cnbc.com) For a company long associated with slower-growing enterprise networking, that scale of upside was the key data point. ### What else did Cisco announce alongside the AI story? Cisco said this quarter it would cut fewer than 4,000 jobs, representing less than 5% of employees, as it reallocates resources toward AI-focused areas including silicon and optics, CNBC reported. (cnbc.com) Robbins said in the interview that the company needed a “rapid reallocation of resources” and added that some affected workers could move into those new roles. That detail matters because it shows where Cisco thinks the demand is shifting inside its own business. The company paired record quarterly revenue with a workforce reduction aimed at funding the parts of the product portfolio tied most directly to AI infrastructure. (investor.cisco.com) ### What should readers watch next? Cisco’s next checkpoint is its fiscal fourth quarter, for which it has guided revenue to $16.7 billion to $16.9 billion and adjusted earnings per share to $1.16 to $1.18. The company’s third-quarter release said the reported quarter ended April 25, 2026, which puts the next earnings update after the quarter ending in late July. (cnbc.com) (investor.cisco.com)