TLDR
- Cisco posted fiscal Q3 adjusted EPS of $1.06 and revenue of $15.8 billion, both beating analyst estimates.
- Networking revenue hit $8.82 billion, well above the $8.44 billion Wall Street expected, driven by AI infrastructure demand.
- The company raised its full-year AI infrastructure order target to $9 billion, up from $5 billion, after securing $5.3 billion year-to-date.
- Cisco announced it will cut nearly 4,000 jobs — less than 5% of its workforce — as part of a restructuring expected to cost up to $1 billion.
- Q4 guidance came in ahead of estimates, with revenue forecast between $16.7 billion and $16.9 billion versus the $15.8 billion analysts had expected.
Cisco Systems (CSCO) delivered a strong fiscal third quarter, with earnings and revenue clearing Wall Street’s bar on the back of surging demand for AI infrastructure hardware.
$CSCO Q3 EARNINGS HIGHLIGHTS
🔹 Revenue: $15.8B (Est $15.54B) 🟢; +12% YoY
🔹 Adj. EPS: $1.06 (Est $1.04) 🟢; +10% YoY
🔹 Product Orders: +35% YoY
🔹 Networking Product Orders: +50%+ YoY
🔸 AI Infrastructure Orders: FY26 expected orders raised to $9B from $5BFY26 Guide:
🔹… pic.twitter.com/u0isPL1WlN— Wall St Engine (@wallstengine) May 13, 2026
The company reported adjusted earnings of $1.06 per share on revenue of $15.8 billion for the quarter ended April 26. Analysts had penciled in $1.03 to $1.04 per share on revenue of around $15.56 to $15.6 billion. CSCO stock jumped nearly 16% in after-hours trading following the results, and was up as much as 20% in premarket trading Thursday.
Going into the report, CSCO was already up 32% year-to-date and 66% over the past 12 months.
CEO Chuck Robbins summed it up plainly on the earnings call: “Our technology is more relevant than ever in the AI era. As a result, we saw record high demand in Q3.”
The driver is no mystery. Hyperscalers like Meta Platforms are pouring hundreds of billions of dollars into AI infrastructure, and that spending flows directly into companies making the hardware that connects it all — Cisco chief among them.
Networking Revenue Surges
Cisco’s networking segment — its biggest revenue source — came in at $8.82 billion, beating the $8.44 billion estimate by a wide margin. Networking product orders rose more than 50% in Q3, while data-center switching orders were up more than 40% year over year.
The company has now secured $5.3 billion in AI infrastructure orders so far this fiscal year, and raised its full-year target to $9 billion from a prior goal of $5 billion.
Q4 guidance was equally strong. Cisco forecast earnings of $1.16 to $1.18 per share on revenue between $16.7 billion and $16.9 billion — well above the $1.08 EPS and $15.8 billion revenue that analysts had expected.
The one soft spot: gross margins. Cisco reported Q3 gross margins of 66%, just below the 66.2% estimate and down from 68.6% a year ago. Rising memory costs are squeezing margins across the hardware industry, and Cisco is trying to offset that by raising prices.
Cisco Announces Restructuring and Job Cuts
Alongside the strong results, Cisco announced plans to reduce its global workforce by fewer than 4,000 people — less than 5% of employees — as part of a restructuring focused on AI and high-growth areas.
Layoff notices were set to begin May 14, rolling out globally in line with local laws. The restructuring is expected to cost up to $1 billion, with roughly $450 million hitting in Q4 and the rest recognized in fiscal 2027.
Robbins addressed the decision directly: “This means making hard decisions.”
The cuts add to a broader wave of tech sector layoffs. According to Layoffs.fyi, 103,571 tech workers have been laid off in 2026 so far — approaching the 124,201 total for all of 2025.
On TipRanks, CSCO carries a consensus Strong Buy rating, with seven Buy ratings and two Hold ratings assigned in the last three months. The average price target stands at $99.00.
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