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The company anticipates fourth-quarter fiscal 2026 revenues between $16.7 billion and $16.9 billion. Non-GAAP earnings are expected between $1.16 per share and $1.18 per share.
The Zacks Consensus Estimate for revenues is pegged at $16.85 billion, indicating growth of 14.86% from the year-ago quarter’s reported figure. The consensus mark for earnings has been steady at $1.17 per share over the past 30 days, suggesting year-over-year growth of 18.18%.
Consensus Estimate Trend
Image Source: Zacks Investment Research
CSCO’s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average being 2%.
Let’s see how things are shaping up prior to this announcement.
Key Factors to Note for CSCO’s Q4 Earnings
Cisco’s fiscal fourth-quarter performance is expected to have benefited from robust demand across its networking portfolio, accelerating AI infrastructure deployments and the ongoing campus-network refresh cycle. The company entered the to-be-reported quarter with considerable momentum. In the third quarter of fiscal 2026, product orders increased 35% year over year and remained up 19% even excluding hyperscalers, while networking orders jumped more than 50%. Enterprise and public-sector orders increased 18% and 27%, respectively, and service-provider/cloud orders surged 105%, indicating that demand was broad-based rather than dependent solely on hyperscaler AI spending.
Cisco said that its fiscal fourth quarter pipeline remained healthy. Strong demand for AI infrastructure is expected to have benefited top-line growth. The company had already accumulated $5.3 billion of hyperscaler AI orders through the fiscal third quarter, supported by Silicon One networking systems and Acacia optics, and secured five additional hyperscaler design wins during the quarter. Separately, Cisco had accumulated roughly $900 million of AI orders from neocloud, sovereign and enterprise customers and reported an approximately $3 billion pipeline in these markets. This momentum suggests that increasing AI-related deployments and the conversion of earlier orders into revenue were important tailwinds in the fourth quarter of fiscal 2026.
Cisco’s campus and enterprise data-center businesses are also likely to have contributed meaningfully. Campus networking orders increased more than 25% in the third quarter of fiscal 2026, data-center switching orders rose more than 40%, and wireless orders increased more than 40%, with Wi-Fi 7 accounting for half of the wireless mix. Importantly, Cisco estimates that its pre-Catalyst 9000 installed base represents tens of billions of dollars of equipment approaching end of support, providing a sizable replacement opportunity. The company characterized the campus refresh as still being very early, with only a mid-single-digit portion of the equipment requiring replacement having been addressed, pointing to continued upgrade activity beyond the third quarter of fiscal 2026. This is expected to have benefited top-line growth in the to-be-reported quarter.
However, Cisco’s fourth quarter of fiscal 2026 is expected to have suffered from higher memory prices and an unfavorable business mix. In the third quarter of fiscal 2026, non-GAAP product gross margin declined 330 basis points year over year, primarily because of higher memory costs and mix, as Cisco’s faster-growing hardware businesses carried a different margin profile from software. Splunk’s transition is another challenge. Customers are increasingly shifting from on-premise transactions toward cloud subscriptions, which delays revenue recognition and creates a near-term revenue-growth headwind.
Cisco is also suffering from stiff competition from Arista Networks (ANET - Free Report) , Dell Technologies (DELL - Free Report) and Hewlett Packard Enterprise (HPE - Free Report) across AI networking and enterprise security domains.
CSCO Shares Outperform Sector
Cisco shares have appreciated 25.4% year to date (YTD), outperforming the Zacks Computer & Technology sector’s return of 16.8%.
CSCO shares have underperformed Dell Technologies and Hewlett-Packard Enterprise YTD, while outperforming Arista Networks. Shares of Dell Technologies, Arista Networks and Hewlett-Packard have appreciated 260.5%, 121.6% and 44%, respectively.
CSCO Stock’s Performance
Image Source: Zacks Investment Research
However, the Value Score of F suggests a stretched valuation for Cisco at this moment.
In terms of the forward 12-month price/sales, CSCO is trading at 7.05X, higher than the broader sector’s 6.58X, Dell Technologies’ 1.62X and Hewlett Packard Enterprise’s 1.43X, but lower than Arista Networks’ 16.64X.
CSCO’s Valuation
Image Source: Zacks Investment Research
Cisco Rides on Strong Portfolio & AI Demand
Cisco’s long-term prospects are driven by a networking supercycle driven by AI, including AI training, inferencing, agentic applications, sovereign clouds, neoclouds and public-sector infrastructure investments. These all require increasingly fast, scalable and secure networks. Cisco has characterized the current transition as broader and faster than previous networking cycles, with enterprise customers modernizing infrastructure in preparation for AI while hyperscalers continue investing aggressively.
Cisco’s strategy of combining Silicon One, Acacia optics, switching, routing and security provides exposure across both hyperscale and enterprise AI infrastructure. The multi-year campus replacement cycle and convergence of networking and security provide another potentially durable growth avenue. AI-related traffic is expected to substantially increase network requirements, while aging installed infrastructure creates a large replacement pool.
However, stiff competition remains a headwind for Cisco. The company must successfully manage the Splunk cloud transition and convert its security portfolio refresh into sustained revenue growth. The opportunity is significant, but Cisco management acknowledged that security’s recovery has been slower than originally hoped.
Conclusion
Cisco’s fourth-quarter fiscal 2026 results are likely to reflect strong networking demand, accelerating AI infrastructure deployments and continued momentum in the campus refresh cycle. The company’s expanding AI order book, broad-based strength across customer segments and sizable installed-base replacement opportunity bode well for its growth prospects. However, rising memory costs, unfavorable product mix, the Splunk cloud transition and intense competition remain concerns. Moreover, Cisco’s stretched valuation leaves limited room for execution missteps.
View the Zacks #1 Rank List
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Should Buy, Sell or Hold Cisco Stock Before Q4 Earnings?
Key Takeaways
Cisco Systems (CSCO - Free Report) is set to release its fourth-quarter fiscal 2026 results on Aug. 12.
The company anticipates fourth-quarter fiscal 2026 revenues between $16.7 billion and $16.9 billion. Non-GAAP earnings are expected between $1.16 per share and $1.18 per share.
The Zacks Consensus Estimate for revenues is pegged at $16.85 billion, indicating growth of 14.86% from the year-ago quarter’s reported figure. The consensus mark for earnings has been steady at $1.17 per share over the past 30 days, suggesting year-over-year growth of 18.18%.
Consensus Estimate Trend
Image Source: Zacks Investment Research
CSCO’s earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average being 2%.
Cisco Systems, Inc. Price and EPS Surprise
Cisco Systems, Inc. price-eps-surprise | Cisco Systems, Inc. Quote
Let’s see how things are shaping up prior to this announcement.
Key Factors to Note for CSCO’s Q4 Earnings
Cisco’s fiscal fourth-quarter performance is expected to have benefited from robust demand across its networking portfolio, accelerating AI infrastructure deployments and the ongoing campus-network refresh cycle. The company entered the to-be-reported quarter with considerable momentum. In the third quarter of fiscal 2026, product orders increased 35% year over year and remained up 19% even excluding hyperscalers, while networking orders jumped more than 50%. Enterprise and public-sector orders increased 18% and 27%, respectively, and service-provider/cloud orders surged 105%, indicating that demand was broad-based rather than dependent solely on hyperscaler AI spending.
Cisco said that its fiscal fourth quarter pipeline remained healthy. Strong demand for AI infrastructure is expected to have benefited top-line growth. The company had already accumulated $5.3 billion of hyperscaler AI orders through the fiscal third quarter, supported by Silicon One networking systems and Acacia optics, and secured five additional hyperscaler design wins during the quarter. Separately, Cisco had accumulated roughly $900 million of AI orders from neocloud, sovereign and enterprise customers and reported an approximately $3 billion pipeline in these markets. This momentum suggests that increasing AI-related deployments and the conversion of earlier orders into revenue were important tailwinds in the fourth quarter of fiscal 2026.
Cisco’s campus and enterprise data-center businesses are also likely to have contributed meaningfully. Campus networking orders increased more than 25% in the third quarter of fiscal 2026, data-center switching orders rose more than 40%, and wireless orders increased more than 40%, with Wi-Fi 7 accounting for half of the wireless mix. Importantly, Cisco estimates that its pre-Catalyst 9000 installed base represents tens of billions of dollars of equipment approaching end of support, providing a sizable replacement opportunity. The company characterized the campus refresh as still being very early, with only a mid-single-digit portion of the equipment requiring replacement having been addressed, pointing to continued upgrade activity beyond the third quarter of fiscal 2026. This is expected to have benefited top-line growth in the to-be-reported quarter.
However, Cisco’s fourth quarter of fiscal 2026 is expected to have suffered from higher memory prices and an unfavorable business mix. In the third quarter of fiscal 2026, non-GAAP product gross margin declined 330 basis points year over year, primarily because of higher memory costs and mix, as Cisco’s faster-growing hardware businesses carried a different margin profile from software. Splunk’s transition is another challenge. Customers are increasingly shifting from on-premise transactions toward cloud subscriptions, which delays revenue recognition and creates a near-term revenue-growth headwind.
Cisco is also suffering from stiff competition from Arista Networks (ANET - Free Report) , Dell Technologies (DELL - Free Report) and Hewlett Packard Enterprise (HPE - Free Report) across AI networking and enterprise security domains.
CSCO Shares Outperform Sector
Cisco shares have appreciated 25.4% year to date (YTD), outperforming the Zacks Computer & Technology sector’s return of 16.8%.
CSCO shares have underperformed Dell Technologies and Hewlett-Packard Enterprise YTD, while outperforming Arista Networks. Shares of Dell Technologies, Arista Networks and Hewlett-Packard have appreciated 260.5%, 121.6% and 44%, respectively.
CSCO Stock’s Performance
Image Source: Zacks Investment Research
However, the Value Score of F suggests a stretched valuation for Cisco at this moment.
In terms of the forward 12-month price/sales, CSCO is trading at 7.05X, higher than the broader sector’s 6.58X, Dell Technologies’ 1.62X and Hewlett Packard Enterprise’s 1.43X, but lower than Arista Networks’ 16.64X.
CSCO’s Valuation
Image Source: Zacks Investment Research
Cisco Rides on Strong Portfolio & AI Demand
Cisco’s long-term prospects are driven by a networking supercycle driven by AI, including AI training, inferencing, agentic applications, sovereign clouds, neoclouds and public-sector infrastructure investments. These all require increasingly fast, scalable and secure networks. Cisco has characterized the current transition as broader and faster than previous networking cycles, with enterprise customers modernizing infrastructure in preparation for AI while hyperscalers continue investing aggressively.
Cisco’s strategy of combining Silicon One, Acacia optics, switching, routing and security provides exposure across both hyperscale and enterprise AI infrastructure. The multi-year campus replacement cycle and convergence of networking and security provide another potentially durable growth avenue. AI-related traffic is expected to substantially increase network requirements, while aging installed infrastructure creates a large replacement pool.
However, stiff competition remains a headwind for Cisco. The company must successfully manage the Splunk cloud transition and convert its security portfolio refresh into sustained revenue growth. The opportunity is significant, but Cisco management acknowledged that security’s recovery has been slower than originally hoped.
Conclusion
Cisco’s fourth-quarter fiscal 2026 results are likely to reflect strong networking demand, accelerating AI infrastructure deployments and continued momentum in the campus refresh cycle. The company’s expanding AI order book, broad-based strength across customer segments and sizable installed-base replacement opportunity bode well for its growth prospects. However, rising memory costs, unfavorable product mix, the Splunk cloud transition and intense competition remain concerns. Moreover, Cisco’s stretched valuation leaves limited room for execution missteps.
Cisco currently carries a Zacks Rank #3 (Hold), which implies that investors should wait for a more favorable point to start accumulating the stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.