Post by : Badri Ariffin

San Jose, California – The latest earnings update from Cisco Systems propelled its stock up by more than 7% in after-hours trading, surpassing Wall Street's expectations and offering an optimistic forecast, largely fueled by a surge in demand for AI infrastructure.

For the quarter concluding on October 25, Cisco’s adjusted earnings grew by 10% year-on-year to reach $1 per share, while revenue increased by 8% to $14.9 billion, both figures exceeding analyst predictions. This result represented the company's first full quarter after acquiring software firm Splunk for $25 billion.

The standout factor in this earnings report was the company’s expanding role in AI infrastructure. Orders for networking solutions related to AI soared past $1.3 billion, up from $800 million in the previous quarter. Cisco attributed this impressive increase to cloud providers establishing next-gen AI data centers, which require high-speed Ethernet upgrades. Overall product orders climbed by 13%, compared to 7% in the last quarter.

Taking advantage of the AI boom, Cisco has reinforced its partnership with Nvidia to provide cutting-edge networking solutions and is gearing up to tap into the AI server market, challenging established competitors like Dell.

Moving forward, Cisco anticipates revenues in the range of $14.9 billion to $15.3 billion for the January quarter, with an average expectation of $15.1 billion — significantly higher than the analysts' average of $14.62 billion. The company's renewed focus on profitable growth, capital returns, and campus technology upgrades is appealing to investors.

Cisco's strategic shift from traditional networking hardware to software, services, and cybersecurity is showing positive results. With the successful integration of Splunk, the company is set to strengthen its position in the data analytics and security sectors.

As of the close on Wednesday, Cisco shares had surged over 24% in 2025, and the recent increase to $79.16 reflects increasing investor confidence in the company's AI-driven trajectory.

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