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CSCO's Splunk AI Push Gains Momentum: Can It Outpace DDOG & CRWD?
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Key Takeaways
CSCO is broadening Splunk into an AI security and observability platform for agentic AI deployments.
Splunk added more than 280 logos in Q4 2026 and helped CSCO beat its 1,000-logo annual target.
Datadog and CrowdStrike are expanding AI observability and security tools that overlap with Splunk.
Cisco Systems (CSCO - Free Report) is benefiting from the growing adoption of Splunk across its security and observability portfolio. In the fourth quarter of fiscal 2026, CSCO’s security portfolio, including Splunk, recorded double-digit order growth. Splunk contributed to several whole-portfolio agreements, added more than 280 customer logos and achieved its highest number of competitive wins in any quarter of fiscal 2026. The company consequently surpassed its target of adding 1,000 Splunk customer logos for the year, highlighting the growing traction from integrating Splunk more closely with its broader networking and security offerings.
Building on this momentum, CSCO expanded Splunk with new artificial intelligence (AI) security and observability capabilities to help enterprises deploy, secure and monitor agentic AI at scale. The enhancements include CSCO AI POD for Splunk, expanded AI-agent observability, Tokenomics capabilities and stronger agentic security operations, providing greater visibility into agent behavior, performance, costs and risks. The expansion could strengthen CSCO’s position against Datadog (DDOG - Free Report) and CrowdStrike (CRWD - Free Report) as enterprises seek integrated AI monitoring and security tools.
The expansion fits CSCO’s broader strategy of combining networking, security, observability and automation. Customers increasingly want unified protection across users, applications and AI agents, while more than 1,500 customers purchased newer CSCO security products such as Secure Access, XDR, Hypershield and AI Defense in the fiscal fourth quarter. Cisco Cloud Control further supports this strategy through a unified management plane and data layer, while the acquisitions of Galileo Technologies and Astrix Securities expand CSCO’s observability and security capabilities.
CSCO Faces Tough Competition
Datadog is increasing pressure on CSCO’s Splunk through Datadog for AI, which spans Agent Observability, Agent Console, Data Observability, GPU Monitoring and AI Guard. Agent Console tracks AI-agent usage, costs and effectiveness, while AI Guard discovers agents and provides runtime protection. Bits AI can identify root causes, recommend fixes and automate remediation. Datadog has also extended Bits Security Analyst to non-Datadog security information and event management (SIEM) systems. AI adoption is expanding Datadog’s customer base, with more than 750 AI customers using its platform, including all 10 of the top AI leaders, while MCP tool calls have grown over 22-fold versus the fourth quarter of 2025.
CrowdStrike is challenging CSCO through its Falcon platform, particularly in AI security and agentic SOC operations. CrowdStrike’s ending annual recurring revenues (ARR) from AI detection and response nearly tripled sequentially, while Next-Gen SIEM ending ARR surpassed $695 million. AgentWorks enables enterprises to build and manage custom AI security agents, while Falcon Shield ARR surged more than 185% year over year in the second quarter of fiscal 2027. CrowdStrike provides AI guardrails, token tracking and cost visibility, directly overlapping with Splunk’s expanding AI security and observability capabilities.
Shares of Cisco Systems have appreciated 42.9% year to date, outperforming the broader Zacks Computer and Technology sector’s 17.4% return.
CSCO Stock’s Price Performance
Image Source: Zacks Investment Research
CSCO stock is trading at a premium, with forward 12-month price/earnings of 21.27X compared with the broader sector’s 20.39X. Cisco Systems has a Value Score of F.
CSCO’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Cisco Systems’ earnings is pegged at $1.32 per share, down by a nickel over the past 30 days, suggesting 32% growth.
View the Zacks #1 Rank List
Image: Shutterstock
CSCO's Splunk AI Push Gains Momentum: Can It Outpace DDOG & CRWD?
Key Takeaways
Cisco Systems (CSCO - Free Report) is benefiting from the growing adoption of Splunk across its security and observability portfolio. In the fourth quarter of fiscal 2026, CSCO’s security portfolio, including Splunk, recorded double-digit order growth. Splunk contributed to several whole-portfolio agreements, added more than 280 customer logos and achieved its highest number of competitive wins in any quarter of fiscal 2026. The company consequently surpassed its target of adding 1,000 Splunk customer logos for the year, highlighting the growing traction from integrating Splunk more closely with its broader networking and security offerings.
Building on this momentum, CSCO expanded Splunk with new artificial intelligence (AI) security and observability capabilities to help enterprises deploy, secure and monitor agentic AI at scale. The enhancements include CSCO AI POD for Splunk, expanded AI-agent observability, Tokenomics capabilities and stronger agentic security operations, providing greater visibility into agent behavior, performance, costs and risks. The expansion could strengthen CSCO’s position against Datadog (DDOG - Free Report) and CrowdStrike (CRWD - Free Report) as enterprises seek integrated AI monitoring and security tools.
The expansion fits CSCO’s broader strategy of combining networking, security, observability and automation. Customers increasingly want unified protection across users, applications and AI agents, while more than 1,500 customers purchased newer CSCO security products such as Secure Access, XDR, Hypershield and AI Defense in the fiscal fourth quarter. Cisco Cloud Control further supports this strategy through a unified management plane and data layer, while the acquisitions of Galileo Technologies and Astrix Securities expand CSCO’s observability and security capabilities.
CSCO Faces Tough Competition
Datadog is increasing pressure on CSCO’s Splunk through Datadog for AI, which spans Agent Observability, Agent Console, Data Observability, GPU Monitoring and AI Guard. Agent Console tracks AI-agent usage, costs and effectiveness, while AI Guard discovers agents and provides runtime protection. Bits AI can identify root causes, recommend fixes and automate remediation. Datadog has also extended Bits Security Analyst to non-Datadog security information and event management (SIEM) systems. AI adoption is expanding Datadog’s customer base, with more than 750 AI customers using its platform, including all 10 of the top AI leaders, while MCP tool calls have grown over 22-fold versus the fourth quarter of 2025.
CrowdStrike is challenging CSCO through its Falcon platform, particularly in AI security and agentic SOC operations. CrowdStrike’s ending annual recurring revenues (ARR) from AI detection and response nearly tripled sequentially, while Next-Gen SIEM ending ARR surpassed $695 million. AgentWorks enables enterprises to build and manage custom AI security agents, while Falcon Shield ARR surged more than 185% year over year in the second quarter of fiscal 2027. CrowdStrike provides AI guardrails, token tracking and cost visibility, directly overlapping with Splunk’s expanding AI security and observability capabilities.
CSCO’s Share Price Performance, Valuation & Estimates
Shares of Cisco Systems have appreciated 42.9% year to date, outperforming the broader Zacks Computer and Technology sector’s 17.4% return.
CSCO Stock’s Price Performance
Image Source: Zacks Investment Research
CSCO stock is trading at a premium, with forward 12-month price/earnings of 21.27X compared with the broader sector’s 20.39X. Cisco Systems has a Value Score of F.
CSCO’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Cisco Systems’ earnings is pegged at $1.32 per share, down by a nickel over the past 30 days, suggesting 32% growth.
Cisco Systems, Inc. Price and Consensus
Cisco Systems, Inc. price-consensus-chart | Cisco Systems, Inc. Quote
Cisco Systems currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.