AI Infrastructure Orders Supercharge Cisco’s First Quarter Revenue

US tech company Cisco Systems estimates that its first quarter revenue could be in the $14.65 billion to $14.85 billion range, surpassing Wall Street projections. According to Reuters, the company attributes the revenue growth to the increase in Cisco AI infrastructure orders.

Riding the AI Boom

Cisco said that AI is providing huge opportunities for the company across sectors. The company did not experience a major drop in demand for its products in the quarter under review. However, it reported minimal impact from import tariffs during the fiscal year.

“We expect the sovereign AI opportunity to build momentum in the second half of fiscal 2026. Cisco will be a core system provider for these significant AI training and inference cluster build-outs and integral to their development and eventual hyperscaling,” Cisco Systems CEO Chuck Robbins said.

The tech giant will leverage the networking upgrades that enterprises need to deploy AI more effectively.

“As we move into the next phase of AI, with agents autonomously conducting tasks alongside humans, the capacity requirements of the network will be compounded to accommodate both unprecedented levels of network traffic and an increasing threat landscape,” he said.

Cisco expects its first quarter revenue to range between $14.65 billion and $14.85 billion against the $14.62 billion projected by analysts. The revenue represented an 8% growth from the same period last year. The company’s net income is expected to stand at $4 billion, representing $0.99 in earnings per share, against $0.98 estimated by analysts.

Growing Enterprise Spending

Hyperscale cloud investments have been driving IT infrastructure financing, providing a solid backdrop for Cisco products. Leading tech companies like Amazon, OpenAI, Microsoft, and Alphabet have been increasing their spending on their tech infrastructure in a bid to enhance their capacity to meet AI demand.

For instance, OpenAI raised $11 billion to expand its AI infrastructure in Abilene, Texas in May 2025. The project is set to hold eight buildings with each data center running a maximum of 50,000 Nvidia Blackwell chips to support high-performance AI workloads.

“Within the enterprise spending environment, there is incremental spending to beef up the infrastructure to accommodate AI, so that could potentially be another growth driver, especially with Cisco having such a big presence in the traditional enterprise market,” David Heger, an Analyst at Edward Jones said.

In the fourth quarter, demand for Cisco networking equipment resulted in orders worth more than $800 million. This pushed its total sales in the 2025 fiscal year past the $2 billion mark. According to Robbins, this amount represents over 100% of the company’s original revenue target.

“AI infrastructure orders we received from web scale customers in fiscal 2025 were more than double our original target, indicating a massive opportunity ahead,” he added.

Strong Security Business Performance

Revenue from Cisco’s networking business grew by 12% while that of its security business grew by 9%. The networking business growth was driven by expansions in webscale infrastructure, switching, industrial IoT and servers, and enterprise routing.

Its newly acquired Splunk business recorded a 14% revenue growth in the quarter. According to analysts, Cisco’s security business remains fundamentally strong despite its slow growth.

“While the percentage growth in security seems low on the surface, it is growing where it needs to. New product growth was over 20%. If one pulls out US Federal, which is very slow, the rest of the business sees double-digit growth,” Zeus Kerravala, Principal Analyst at ZK Research said.