Cisco beats by $0.05, beats on revs; guides Q1 EPS above consensus, revs above consensus; guides FY27 EPS above consensus, revs above consensus (123.88 +3.45)
- Reports Q4 (Jul) earnings of $1.22 per share, excluding non-recurring items, $0.05 better than the FactSet Consensus of $1.17; revenues rose 17.6% year/year to $17.25 bln vs the $16.84 bln FactSet Consensus.
- Total non-GAAP gross margin declined to 66.3% vs 68.4% a year ago, but was at higher end of 65.5-66.5% prior guidance.
- Product revenue up 24% and services revenue was flat.
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Significant momentum and raised expectations for AI infrastructure from hyperscalers:
- $4 bln of orders taken in Q4, bringing the total for FY 2026 to $9.3 bln.
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Broad-based, record high demand for Cisco technology with a networking supercycle underway:
- Q4 total product orders up 35% year over year; up 25% excluding hyperscalers, with double-digit growth across every geography and customer market.
- Networking product orders grew 40% year over year in Q4, marking the eighth consecutive quarter of double-digit growth.
- Co issues upside guidance for Q1 (Oct), sees EPS of $1.32-1.34, excluding non-recurring items, vs. $1.16 FactSet Consensus; sees Q1 revs of $18.00-18.20 bln vs. $16.83 bln FactSet Consensus.
- Co guides to Q1 total non-GAAP gross margin of 65-66% and non-GAAP operating margin of 35.5-36.5%.
- Co issues upside guidance for FY27, sees EPS of $5.05-5.11, excluding non-recurring items, vs. $4.83 FactSet Consensus; sees FY27 revs of $72.20-73.40 bln vs. $69.12 bln FactSet Consensus.
- "We delivered a very strong close to fiscal 2026, marking another record year for Cisco. Our record performance is a testament to the accelerated pace of innovation and the excellent execution by our teams," said Chuck Robbins, Chair and CEO of Cisco. "With the breadth and depth of our portfolio and our competitive differentiation in secure networking, Cisco is well positioned to support our customers however or wherever they decide to deploy AI." "In Q4, we delivered record revenue, non-GAAP operating income and EPS, all exceeding the high end of our guidance ranges and demonstrating strong financial discipline and operating leverage," said Mark Patterson, CFO of Cisco.
- "In fiscal 2026, Cisco achieved its highest productivity metrics in 30 years measured by revenue, non-GAAP operating margin, and earnings per employee. As we enter fiscal 2027, we remain focused on delivering durable growth, consistent profitability and continued capital returns as we make the strategic investments to capitalize on the significant growth opportunities we see ahead."