Cisco’s first quarter results were met with a positive market reaction, reflecting robust demand for AI infrastructure and campus networking solutions. Management attributed the double-digit growth in both revenue and profit to strong product orders—particularly from hyperscaler and enterprise customers—alongside successful execution of initiatives to address rising memory costs. CEO Charles Robbins noted that “record top line performance, combined with operating efficiencies and outstanding execution by our teams,” underpinned the company’s ability to deliver above expectations this quarter.
Is now the time to buy CSCO? Find out in our full research report (it’s free for active Edge members).
Cisco (CSCO) Q1 CY2026 Highlights:
- Revenue: $15.84 billion vs analyst estimates of $15.55 billion (12% year-on-year growth, 1.9% beat)
- Adjusted EPS: $1.06 vs analyst estimates of $1.04 (2.3% beat)
- Adjusted EBITDA: $6.05 billion vs analyst estimates of $5.93 billion (38.2% margin, 2% beat)
- Revenue Guidance for Q2 CY2026 is $16.8 billion at the midpoint, above analyst estimates of $15.78 billion
- Management raised its full-year Adjusted EPS guidance to $4.28 at the midpoint, a 3.1% increase
- Operating Margin: 25%, up from 22.6% in the same quarter last year
- Annual Recurring Revenue: $31.2 billion vs analyst estimates of $31.2 billion (2% year-on-year growth, in line)
- Billings: $16.03 billion at quarter end, up 12% year on year
- Market Capitalization: $455.7 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Cisco’s Q1 Earnings Call
- Amit Daryanani (Evercore ISI) asked about the durability of double-digit growth and the differentiators for Silicon One. CEO Charles Robbins emphasized broad-based AI demand and cited Silicon One’s integration and supply chain control as key factors.
- Tal Liani (Bank of America) questioned whether enterprise customers were pulling forward orders due to supply concerns. CFO Mark Patterson acknowledged some modest pull-forward but pointed to strong pipeline growth and pricing as supporting fundamentals.
- Aaron Rakers (Wells Fargo) inquired about supply chain risks and the ability to secure long-term silicon and memory supply. Patterson outlined Cisco’s direct management of its supply chain and noted no decommitments, emphasizing inventory and advance purchase strategies.
- David Vogt (UBS) pressed for detail on security and the impact of the Splunk transition. Robbins stated that new security products are gaining traction, while the Splunk cloud shift is expected to become less of a drag as the mix stabilizes.
- Michael Ng (Goldman Sachs) sought clarification on pricing strategies. Patterson detailed new, shorter quoting windows and selective hardware price increases, noting these are starting to benefit revenue and margin trends.
Catalysts in Upcoming Quarters
In the coming quarters, StockStory analysts will be monitoring (1) the pace and breadth of AI infrastructure order intake, especially among new hyperscaler and enterprise customers, (2) the stabilization of gross margins as pricing strategies and supply chain investments take hold, and (3) customer adoption rates for next-generation security and networking products. Progress on restructuring and the Splunk cloud transition will also be key indicators of sustained momentum.
Cisco currently trades at $115.46, up from $101.87 just before the earnings. Is the company at an inflection point that warrants a buy or sell? The answer lies in our full research report (it’s free).
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