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CSCO Taps NVIDIA to Drive Secure AI at the Edge: More Upside Ahead?
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Key Takeaways
Cisco expands Secure AI Factory with NVIDIA to enable faster, secure AI deployment beyond data centers.
CSCO supports edge AI workloads using NVIDIA GPUs, reducing energy use and data center reliance.
Cisco reports 21% YoY networking revenue growth, driven by strong AI infrastructure demand.
Cisco Systems (CSCO - Free Report) is expanding its Secure AI Factory with NVIDIA Corporation (NVDA), which will enable enterprises to run AI everywhere instead of only in large data centers. The expanded solution will help enterprises deploy AI faster and keep AI systems secure from the beginning.
The Cisco-NVIDIA collaboration is helping companies by offering support for edge inference use cases. Cisco is now enabling enterprises to run mission-critical AI workloads at the edge without the energy cost and footprint of data center-scale hardware. This is possible because NVIDIA RTX PRO 4500 Blackwell Server Edition GPUs are now supported across the Cisco UCS and Cisco Unified Edge portfolios. The Cisco AI Grid with NVIDIA reference design combines the power of Cisco's Mobility Services Platform with NVIDIA RTX PRO Blackwell Series GPUs. Supported by this solution, service providers can leverage their existing networks to offer managed services for edge AI applications with carrier-grade reliability and sovereignty.
The Cisco-NVIDIA collaboration is introducing high-speed switches, including a new 102.4Tbps Cisco N9100 powered by NVIDIA Spectrum-6 Ethernet switch silicon. The new product expands CSCO’s ultra-fast switch portfolio, which already includes the 800G N9100 powered by NVIDIA Spectrum-4 Ethernet switch silicon. Cisco Nexus Hyperfabric, now a part of Cisco Nexus One, will support Cisco N9000 Series switches, including the N9100 Series powered by NVIDIA Spectrum-X Ethernet silicon.
Cisco Infuses Security in Secure AI Factory With NVIDIA
Cisco is infusing security into the core of Secure AI Factory with NVIDIA. This helps enterprises safeguard their AI platforms and services not only from external threats but also from rogue agent behavior. Cisco Hybrid Mesh Firewall delivers consistent security policies across a diverse set of enforcement points, including network switches, workload agents and more.
The solution is now extended to enable policy enforcement on NVIDIA BlueField data processing units embedded in NVIDIA GPU servers connected to Cisco Nexus One fabrics. This ensures that threats are blocked at the server level before they reach an organization’s data.
Cisco AI Defense delivers model security, automated vulnerability testing and purpose-built guardrails for AI agents at the edge through integration with NVIDIA NeMo Guardrails, a part of NVIDIA AI Enterprise software. AI Defense, as a part of the Cisco Secure AI Factory with NVIDIA, now extends to secure agent-to-agent interactions that are necessary to accomplish tasks and execute workflows in an increasingly distributed AI deployment process.
CSCO’s Top Line to Ride on Strong Networking Revenues
Cisco’s networking revenues increased in the second quarter of fiscal 2026, with the figure reaching $8.29 billion, up 21% on a year-over-year basis and 6.8% sequentially. The quarterly results benefited from robust demand for AI infrastructure and campus networking solutions. The company’s networking portfolio, powered by Silicon One, AI-native security solutions and operating systems, is expanding CSCO’s AI footprint.
Networking product orders rose 20% in the fiscal second quarter, marking the sixth consecutive quarter of double-digit growth driven by hyperscale infrastructure, enterprise routing, campus switching, wireless, industrial IoT and servers. This bodes well for networking revenues in fiscal 2026.
Cisco saw strong Security order growth for new and refreshed products, including Secure Access, XDR, Hypershield, AI Defense and refreshed firewalls in the fiscal second quarter. As the adoption of AI tools grows and Agentic AI increases at the network edge, Cisco expects to see continued momentum in its SASE business, including Secure Access and SD-WAN.
An expanding portfolio is expected to boost CSCO’s top-line growth. The company expects revenues between $15.4 billion and $15.6 billion for the fiscal third quarter. The Zacks Consensus Estimate for revenues is currently pegged at $15.52 billion, suggesting 9.7% growth from the year-ago quarter.
Cisco is facing stiff competition in both the networking and security domains from the likes of Arista Networks (ANET - Free Report) and Fortinet (FTNT - Free Report) .
Arista Networks holds a leadership position in 100-gigabit Ethernet switches and is increasingly gaining market traction in 200 and 400-gigabit high-performance switching products. The company surpassed shipments of 150 million cumulative ports in the fourth quarter of 2025, with healthy momentum from the Arista 2.0 strategy.
Fortinet’s AI-powered secured operations business is accelerating rapidly. The network security market is experiencing structural expansion as enterprises prioritize zero-trust architectures and hybrid cloud protection, creating a substantial growth runway for Fortinet in 2026. The company’s strategic focus on expanding its Secure SD-WAN portfolio and enhancing Security Fabric integration creates compelling migration opportunities from legacy competitors.
Cisco shares have rallied 30.9% in a year, underperforming the broader Zacks Computer and Technology sector’s growth of 31.7%.
CSCO Stock’s Performance
Image Source: Zacks Investment Research
CSCO stock is trading at a premium, with a trailing 12-month price/book of 6.53X compared with the Zacks Computer Networking industry’s 6.23X. Cisco has a Value Score of D.
CSCO Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for fiscal 2026 earnings is currently pegged at $4.14 per share, unchanged over the past 30 days, suggesting 8.77% growth from the figure reported in fiscal 2025.
View the Zacks #1 Rank List
Image: Bigstock
CSCO Taps NVIDIA to Drive Secure AI at the Edge: More Upside Ahead?
Key Takeaways
Cisco Systems (CSCO - Free Report) is expanding its Secure AI Factory with NVIDIA Corporation (NVDA), which will enable enterprises to run AI everywhere instead of only in large data centers. The expanded solution will help enterprises deploy AI faster and keep AI systems secure from the beginning.
The Cisco-NVIDIA collaboration is helping companies by offering support for edge inference use cases. Cisco is now enabling enterprises to run mission-critical AI workloads at the edge without the energy cost and footprint of data center-scale hardware. This is possible because NVIDIA RTX PRO 4500 Blackwell Server Edition GPUs are now supported across the Cisco UCS and Cisco Unified Edge portfolios. The Cisco AI Grid with NVIDIA reference design combines the power of Cisco's Mobility Services Platform with NVIDIA RTX PRO Blackwell Series GPUs. Supported by this solution, service providers can leverage their existing networks to offer managed services for edge AI applications with carrier-grade reliability and sovereignty.
The Cisco-NVIDIA collaboration is introducing high-speed switches, including a new 102.4Tbps Cisco N9100 powered by NVIDIA Spectrum-6 Ethernet switch silicon. The new product expands CSCO’s ultra-fast switch portfolio, which already includes the 800G N9100 powered by NVIDIA Spectrum-4 Ethernet switch silicon. Cisco Nexus Hyperfabric, now a part of Cisco Nexus One, will support Cisco N9000 Series switches, including the N9100 Series powered by NVIDIA Spectrum-X Ethernet silicon.
Cisco Infuses Security in Secure AI Factory With NVIDIA
Cisco is infusing security into the core of Secure AI Factory with NVIDIA. This helps enterprises safeguard their AI platforms and services not only from external threats but also from rogue agent behavior. Cisco Hybrid Mesh Firewall delivers consistent security policies across a diverse set of enforcement points, including network switches, workload agents and more.
The solution is now extended to enable policy enforcement on NVIDIA BlueField data processing units embedded in NVIDIA GPU servers connected to Cisco Nexus One fabrics. This ensures that threats are blocked at the server level before they reach an organization’s data.
Cisco AI Defense delivers model security, automated vulnerability testing and purpose-built guardrails for AI agents at the edge through integration with NVIDIA NeMo Guardrails, a part of NVIDIA AI Enterprise software. AI Defense, as a part of the Cisco Secure AI Factory with NVIDIA, now extends to secure agent-to-agent interactions that are necessary to accomplish tasks and execute workflows in an increasingly distributed AI deployment process.
CSCO’s Top Line to Ride on Strong Networking Revenues
Cisco’s networking revenues increased in the second quarter of fiscal 2026, with the figure reaching $8.29 billion, up 21% on a year-over-year basis and 6.8% sequentially. The quarterly results benefited from robust demand for AI infrastructure and campus networking solutions. The company’s networking portfolio, powered by Silicon One, AI-native security solutions and operating systems, is expanding CSCO’s AI footprint.
Networking product orders rose 20% in the fiscal second quarter, marking the sixth consecutive quarter of double-digit growth driven by hyperscale infrastructure, enterprise routing, campus switching, wireless, industrial IoT and servers. This bodes well for networking revenues in fiscal 2026.
Cisco saw strong Security order growth for new and refreshed products, including Secure Access, XDR, Hypershield, AI Defense and refreshed firewalls in the fiscal second quarter. As the adoption of AI tools grows and Agentic AI increases at the network edge, Cisco expects to see continued momentum in its SASE business, including Secure Access and SD-WAN.
An expanding portfolio is expected to boost CSCO’s top-line growth. The company expects revenues between $15.4 billion and $15.6 billion for the fiscal third quarter. The Zacks Consensus Estimate for revenues is currently pegged at $15.52 billion, suggesting 9.7% growth from the year-ago quarter.
Networking & Security – CSCO Faces Stiff Competition
Cisco is facing stiff competition in both the networking and security domains from the likes of Arista Networks (ANET - Free Report) and Fortinet (FTNT - Free Report) .
Arista Networks holds a leadership position in 100-gigabit Ethernet switches and is increasingly gaining market traction in 200 and 400-gigabit high-performance switching products. The company surpassed shipments of 150 million cumulative ports in the fourth quarter of 2025, with healthy momentum from the Arista 2.0 strategy.
Fortinet’s AI-powered secured operations business is accelerating rapidly. The network security market is experiencing structural expansion as enterprises prioritize zero-trust architectures and hybrid cloud protection, creating a substantial growth runway for Fortinet in 2026. The company’s strategic focus on expanding its Secure SD-WAN portfolio and enhancing Security Fabric integration creates compelling migration opportunities from legacy competitors.
CSCO's Share Price Performance, Valuation & Estimates
Cisco shares have rallied 30.9% in a year, underperforming the broader Zacks Computer and Technology sector’s growth of 31.7%.
CSCO Stock’s Performance
Image Source: Zacks Investment Research
CSCO stock is trading at a premium, with a trailing 12-month price/book of 6.53X compared with the Zacks Computer Networking industry’s 6.23X. Cisco has a Value Score of D.
CSCO Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for fiscal 2026 earnings is currently pegged at $4.14 per share, unchanged over the past 30 days, suggesting 8.77% growth from the figure reported in fiscal 2025.
Cisco Systems, Inc. Price and Consensus
Cisco Systems, Inc. price-consensus-chart | Cisco Systems, Inc. Quote
Cisco currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.