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Cisco Systems Delivers Record Q1 Results, Raises FY27 Outlook
Key Takeaways
Cisco delivered record quarterly results, fueled by accelerating AI infrastructure and networking demand.
Cisco raised its FY27 revenue and earnings guidance, reinforcing its growth trajectory.
Cisco's reasonable forward P/E valuation and generous dividend add to its investment appeal.
Cisco Systems (CSCO - Free Report) ) delivered record fiscal first-quarter results after the closing bell on Thursday, fueled by accelerating demand for AI infrastructure and networking solutions.
The technology giant also raised its full-year guidance, reinforcing confidence in its growth trajectory as the AI infrastructure buildout accelerates.
Shares rose 1% in today’s trading session and are up another 1% in after-hours trading, extending a +30% year-to-date gain.
Image Source: Zacks Investment Research
Cisco's Record Q1 Results
Cisco reported record quarterly adjusted earnings of $1.40 per share, soaring 40% year over year and topping the Zacks EPS Consensus of $1.33 by 5%.
Revenue surged 24% to an all-time quarterly high of $18.52 billion, exceeding expectations of $18.13 billion by 2%.
Most exhilarating was that this marked Cisco's strongest revenue and adjusted earnings growth in more than 15 years.
Notably, Networking revenue jumped 43% to $11.13 billion, reflecting robust AI infrastructure demand. Adjusted operating margin also reached a record 37.8%, highlighting improved operational efficiency.
Cisco Raises FY27 Guidance on AI Demand
Looking ahead, Cisco raised its current fiscal 2027 revenue guidance to $74.8-$75.8 billion, up from its previous forecast of $72.2-$73.4 billion and ahead of Wall Street’s expectations of $73.34 billion or roughly 16% growth.
Adjusted EPS guidance was also increased to $5.47-$5.53, compared with $5.05-$5.11 previously and ahead of consensus forecast of $5.17 or 19% growth.
Most encouragingly, Cisco raised its FY27 hyperscaler AI infrastructure revenue outlook to $9 billion, more than double FY26 levels.
For Q2, management projects revenue of $18-$18.2 billion and adjusted EPS of $1.34-$1.36, also ahead of the Street’s forecast and signaling sustained momentum.
Cisco's Dividend & Shareholder Returns
Cisco maintained its generous quarterly dividend at $0.42 per share, or $1.68 annually, returning $3.7 billion to shareholders through dividends and share repurchases during Q1.
Image Source: Zacks Investment Research
Bottom Line
Sporting a Zacks Rank #2 (Buy), Cisco Systems remains an attractive way to capitalize on the AI infrastructure buildout while benefiting from steady dividend income.
Record quarterly results, expanding operating margins, and higher full-year guidance reinforce Cisco's improving growth prospects, while its reasonable 19X forward earnings multiple adds to the stock's investment appeal.
View the Zacks #1 Rank List
Image: Bigstock
Cisco Systems Delivers Record Q1 Results, Raises FY27 Outlook
Key Takeaways
Cisco Systems (CSCO - Free Report) ) delivered record fiscal first-quarter results after the closing bell on Thursday, fueled by accelerating demand for AI infrastructure and networking solutions.
The technology giant also raised its full-year guidance, reinforcing confidence in its growth trajectory as the AI infrastructure buildout accelerates.
Shares rose 1% in today’s trading session and are up another 1% in after-hours trading, extending a +30% year-to-date gain.
Image Source: Zacks Investment Research
Cisco's Record Q1 Results
Cisco reported record quarterly adjusted earnings of $1.40 per share, soaring 40% year over year and topping the Zacks EPS Consensus of $1.33 by 5%.
Revenue surged 24% to an all-time quarterly high of $18.52 billion, exceeding expectations of $18.13 billion by 2%.
Most exhilarating was that this marked Cisco's strongest revenue and adjusted earnings growth in more than 15 years.
Notably, Networking revenue jumped 43% to $11.13 billion, reflecting robust AI infrastructure demand. Adjusted operating margin also reached a record 37.8%, highlighting improved operational efficiency.
Cisco Raises FY27 Guidance on AI Demand
Looking ahead, Cisco raised its current fiscal 2027 revenue guidance to $74.8-$75.8 billion, up from its previous forecast of $72.2-$73.4 billion and ahead of Wall Street’s expectations of $73.34 billion or roughly 16% growth.
Adjusted EPS guidance was also increased to $5.47-$5.53, compared with $5.05-$5.11 previously and ahead of consensus forecast of $5.17 or 19% growth.
Most encouragingly, Cisco raised its FY27 hyperscaler AI infrastructure revenue outlook to $9 billion, more than double FY26 levels.
For Q2, management projects revenue of $18-$18.2 billion and adjusted EPS of $1.34-$1.36, also ahead of the Street’s forecast and signaling sustained momentum.
Cisco's Dividend & Shareholder Returns
Cisco maintained its generous quarterly dividend at $0.42 per share, or $1.68 annually, returning $3.7 billion to shareholders through dividends and share repurchases during Q1.
Image Source: Zacks Investment Research
Bottom Line
Sporting a Zacks Rank #2 (Buy), Cisco Systems remains an attractive way to capitalize on the AI infrastructure buildout while benefiting from steady dividend income.
Record quarterly results, expanding operating margins, and higher full-year guidance reinforce Cisco's improving growth prospects, while its reasonable 19X forward earnings multiple adds to the stock's investment appeal.