Cisco Systems, a multinational technology conglomerate renowned for its networking hardware, software, and telecommunications equipment, 1 released its financial results for the fiscal third quarter of 2025, which ended on April 26, revealing performance metrics that surpassed the expectations of Wall Street analysts. The company’s earnings and revenue figures both exceeded consensus estimates, and its forward-looking guidance for the fiscal year 2025 also painted a more optimistic picture than previously anticipated by the market.
Specifically, Cisco reported adjusted earnings per share (EPS) of 96 cents, exceeding the LSEG (London Stock Exchange Group) consensus estimate of 92 cents per share. On the revenue front, the company announced a total revenue of $14.15 billion, also surpassing the analysts’ expectation of $14.08 billion. This positive performance underscores Cisco’s resilience and its ability to navigate the complexities of the current global economic landscape.
Examining the year-over-year growth, Cisco demonstrated a healthy increase in revenue. For the quarter ending April 26, 2025, the company’s revenue reached $14.15 billion, marking an 11% increase compared to the $12.7 billion reported during the same period in the previous fiscal year. This growth indicates sustained demand for Cisco’s products and services across its various business segments. Furthermore, Cisco’s net income also experienced a significant upswing, rising to $2.49 billion, or 62 cents per share, compared to $1.89 billion, or 46 cents per share, in the corresponding quarter of the prior year. This improvement in net income highlights the company’s enhanced profitability.
Looking ahead, Cisco’s management provided optimistic guidance for the full fiscal year 2025. The company anticipates adjusted earnings per share to fall within the range of 96 cents to 98 cents, with revenue projected to be between $14.5 billion and $14.7 billion. This guidance exceeded the expectations of analysts surveyed by LSEG, who had forecasted adjusted earnings per share of 95 cents on revenue of $14.58 billion. Notably, Cisco explicitly stated that its guidance incorporates the anticipated impact of the comprehensive tariffs on imported goods into the U.S. implemented by President Donald Trump, suggesting that the company has factored these macroeconomic headwinds into its financial projections.
A significant highlight of Cisco’s earnings report was the robust growth in its artificial intelligence (AI) infrastructure orders from web-scale companies. During the reported quarter, Cisco secured over $600 million in AI infrastructure orders from these key customers, bringing the total for the fiscal year to date to over $1.25 billion. This milestone is particularly noteworthy as Cisco announced that it surpassed the $1 billion mark a full quarter ahead of its internal schedule, indicating strong momentum in its AI-related business.
The quarter also saw Cisco introduce innovative products and services aligned with emerging technological trends. The company launched a Webex AI agent specifically designed for customer service applications, leveraging the power of artificial intelligence to enhance customer interactions and streamline support processes. Additionally, Cisco unveiled new Ethernet switches incorporating AMD Pensando data processing units (DPUs). These advanced DPUs are expected to contribute to hardware consolidation within data centers, offering improved performance and efficiency.
Breaking down Cisco’s revenue by segment, the networking division, which remains a core part of its business, reported revenue of $7.07 billion, representing an 8% increase. This figure also exceeded the $6.81 billion consensus estimate from analysts polled by StreetAccount, indicating continued strength in Cisco’s traditional networking solutions.
However, not all segments performed above expectations. Revenue from Cisco’s security products division reached $2.01 billion, marking a substantial 54% jump. This significant growth is largely attributable to the inclusion of Splunk, the data analytics and cybersecurity firm that Cisco acquired last year for approximately $27 billion. Despite the strong percentage increase, the security revenue figure fell slightly below the StreetAccount consensus estimate of $2.17 billion. This suggests that while the Splunk acquisition is contributing significantly to the security segment’s growth, the integration and overall performance might still be in the early stages of fully aligning with market expectations.
Investor reaction to Cisco’s positive earnings report was favorable. As of the close of trading on Wednesday, Cisco’s shares had experienced a year-to-date increase of 3.5%, outperforming the S&P 500 index, which remained relatively flat during the same period. This market response reflects investor confidence in Cisco’s current performance and its future prospects, as indicated by the optimistic guidance.
Following the release of the earnings report, Cisco’s executives were scheduled to host a conference call with analysts starting at 4:30 p.m. Eastern Time (ET). This call would provide an opportunity for the management team to further elaborate on the company’s financial results, discuss strategic initiatives, and address any questions from the investment community regarding Cisco’s performance and outlook. The detailed earnings report and the subsequent conference call offer valuable insights into Cisco’s operational execution and its strategic direction in a dynamic technology market.
