Wall Street Eyes Cisco’s Next Move as AI Orders Surge Past $9 Billion and a Key Conference Draws Near

Cisco reports record $15.84B Q3 revenue, AI orders hit $1.9B; stock rallies 55% YTD. Analysts upgrade amid 'networking supercycle' ahead of Las Vegas conference.

The networking giant is heading to Las Vegas with a tailwind few could have predicted six months ago. Cisco Systems will host its annual user conference from May 31 to June 4, and the timing could hardly be better. Coming off a record fiscal third quarter and a stock rally that ranks as its strongest weekly performance since October 2001, the company is expected to flesh out the details of its artificial intelligence strategy in front of thousands of customers and partners.

The market’s attention, however, is already fixed on the numbers that drove Cisco shares roughly 55 percent higher year-to-date. The stock now trades at just above 100 euros, a level that leaves it far outstripping its 50-day moving average. On a weekly basis, the gain approached 20 percent, powered by a single catalyst: the company’s updated outlook for AI-related orders.

Cisco’s third-quarter results landed with force. Revenue rose 12 percent year over year to a record $15.84 billion, while adjusted earnings per share reached $1.06. The real headline, though, was the demand for AI infrastructure. Orders from large cloud providers for networking gear tied to artificial intelligence hit $1.9 billion in the quarter alone, prompting management to lift its full-year target for such orders to $9 billion — nearly double the previous estimate. Product orders for data-center switches jumped 40 percent, and the broader networking segment saw its backlog swell as enterprises accelerated IT upgrades.

That kind of momentum has analysts scrambling to revise their models. HSBC upgraded Cisco to “buy” and raised its price target from $77 to $137, citing what it calls an impending “networking supercycle” fueled by AI buildouts. Other banks followed suit: Citic Securities now targets $130, BNP Paribas Exane $132, Morgan Stanley $120 and Evercore $150. The bullish consensus comes despite a forward price-to-earnings ratio of 36, well above the sector average of 31, and a Relative Strength Index of 76 — a level that historically signals an overbought condition.

Not everything in the quarter was pristine. Operating cash flow slipped to $3.75 billion in the third quarter as capital spending rose, a small crack in an otherwise solid liquidity picture. Yet management remains confident enough to keep cash flowing back to shareholders. Cisco declared a quarterly dividend of $0.42 per share, payable on July 22, 2026, and continues to repurchase stock under a multi-billion-dollar buyback program.

The dividend and buybacks come even as the company trims its workforce by 4,000 positions, roughly 5 percent of its global headcount. The restructuring, which is meant to sharpen the focus on high-growth areas such as semiconductors, optics and cybersecurity, is expected to cost as much as $1 billion before taxes.

For the current quarter, Cisco forecasts revenue of up to $16.9 billion, a figure that would mark further acceleration. With the Las Vegas conference now just weeks away, the next catalyst may already be taking shape. The question is whether the stock’s technical froth will give way to a fresh leg up — or force a pause before the next chapter of the AI-driven network cycle begins.