Core Insights - Cisco Systems reported strong fourth-quarter fiscal 2025 results, exceeding both earnings and revenue estimates, but shares fell approximately 2% in after-market trading due to weak future forecasts [1][3]. Financial Performance - Earnings per share were 99 cents, surpassing the Zacks Consensus Estimate of 97 cents, and reflecting a 14% increase year-over-year [3]. - Revenues increased by 8% year-over-year to $14.67 billion, exceeding the consensus estimate of $14.60 billion [3]. - Product revenues rose by 10% to $10.9 billion, while services revenues remained flat at $3.78 billion [4]. Future Outlook - For fiscal 2026, Cisco anticipates revenues between $59 billion and $60 billion and earnings per share between $4.00 and $4.06, with the Zacks Consensus Estimate at $59.18 billion for revenues and $3.79 for earnings per share [5]. - In the ongoing fiscal first quarter, Cisco projects revenues between $14.65 billion and $14.85 billion and earnings in the range of 97 to 99 cents per share, with the Zacks Consensus Estimate at $14.56 billion for revenues and 97 cents for earnings per share [5]. Industry ETFs - iShares U.S. Telecommunications ETF (IYZ) has a 19.4% allocation to Cisco, with total assets under management (AUM) of $511.9 million [6]. - First Trust Nasdaq Cybersecurity ETF (CIBR) holds 9% of Cisco, with an AUM of $9.7 billion [7]. - iShares Edge MSCI USA Value Factor ETF (VLUE) features Cisco at 7.1%, with an AUM of $6.7 billion [8]. - Pacer Data and Digital Revolution ETF (TRFK) includes Cisco at 8% of its assets, with an AUM of $104.8 million [10]. - Amplify Cybersecurity ETF (HACK) allocates 6.6% to Cisco, with an AUM of $2.2 billion [11].

Technology & Network - Aentic is the desired destination for customers, driven by real-time, low-latency communication between agents [1] - Low latency communication drives demand for network capacity and necessitates integrated network security [1][2] - Traditional firewall appliances introduce unacceptable latency, requiring security to be fused into the network [2] Labor & Hiring - The company anticipates hiring fewer people through technology adoption [3] - The company is evaluating existing open positions to determine if they can be filled with technology instead of new hires [3] - The company aims to slow the pace of hiring over time, focusing on increasing the productivity and innovation of existing engineers [4] - The company prioritizes enhancing the productivity of current engineers to gain a competitive advantage, rather than reducing headcount [4]

Shares of Cisco Systems Inc CSCO came under some pressure in early trading on Thursday, after the company Wednesday reported upbeat fiscal fourth-quarter results. Here are some key analyst takeaways. Check out other analyst stock ratings. JPMorgan: Cisco Systems reported revenues of $14.7 billion. It topped the consensus of $14.6 billion, driven by stronger-than-expected Networking revenues. The company's gross and operating margins of 68.4% and 34.3% surpassed consensus estimates of 68.2% and 34.1%, respec ...

Financial Performance - Cisco achieved 5% growth for the year and strong EPS growth [2] - Q4 showed meaningful growth of 8% and double-digit EPS growth [2] - Cisco recognized roughly $1 billion of AI infrastructure orders during the quarter [4] AI & Webscale Business - Cisco more than doubled its initial target of $1 billion in AI orders from webscale customers [3] - Large cloud providers (the six of them) grew triple digits (greater than 100%) for Cisco during the year, marking four consecutive quarters of growth exceeding 100% [11] Security Business - Excluding US Federal, overall bookings were up 10% [7] - Excluding US Federal, security orders were up double digits [7] - New and refreshed security products, comprising 2/3 of the organic Cisco security portfolio, grew in excess of 20% during the quarter [9] Innovation & Technology - Cisco is delivering innovation at a faster pace than seen in a long time [8] - Cisco's products consume less energy, driving strong demand from webscale customers [10][11] - Cisco is fusing security into the network to avoid latency issues [15] Agentics & Labor - Customers are aiming for "Agentics," which involves machines performing tasks typically done by people [14] - Cisco is evaluating whether new hires are necessary, exploring technology-based alternatives [16]

Market Overview - US stock index futures are all up, with Dow futures rising by 0.06%, S&P 500 futures by 0.04%, and Nasdaq futures by 0.05% [1] - European indices also show positive movement, with Germany's DAX up by 0.68%, UK's FTSE 100 up by 0.07%, France's CAC40 up by 0.62%, and the Euro Stoxx 50 up by 0.64% [2][3] Commodity Prices - WTI crude oil increased by 0.49%, reaching $62.96 per barrel, while Brent crude oil rose by 0.47% to $65.94 per barrel [3][4] Federal Reserve Insights - Federal Reserve's Daly indicated that there seems to be no necessity for a significant rate cut next month, opposing a 50 basis points cut at the September meeting [5] - Goldman Sachs predicts the Federal Reserve will cut rates three times this year, each by 25 basis points, and two more times in 2026, bringing rates down to a range of 3% to 3.25% [8] Company Earnings Reports - Xunlei (XNET.US) reported Q2 revenue of $104 million, a 30.6% year-over-year increase, with Non-GAAP net profit rising to $8.3 million [9] - Vipshop (VIPS.US) saw Q2 revenue decline by 4.09% to 25.8 billion RMB, while GMV grew by 1.7% [10] - NetEase Youdao (DAO.US) achieved Q2 net revenue of 1.42 billion RMB, a 7.2% increase, and reported a historic high in operating profit [11] - Sunlands Technology (STG.US) reported Q2 revenue growth of 9.5% to 539 million RMB, with net profit increasing by 54% [12] - Cisco (CSCO.US) exceeded expectations with Q4 revenue growth of 7.6%, reaching $14.7 billion, and adjusted gross margin of 68.4% [13] Industry Trends - Tesla (TSLA.US) experienced a 24% increase in sales in Norway, contrasting with a significant decline in other European markets [14] - Apple (AAPL.US) is focusing on AI with ambitious new products, including a desktop robot and smart home security cameras, aiming for a strategic revival in the AI sector [15]

Investment Rating - The report assigns an "Outperform" rating for Cisco, indicating an expected total return over the next 12-18 months that exceeds the relevant market benchmark [21]. Core Insights - Cisco's Q4 FY25 results showed revenue of $14.7 billion, a year-over-year increase of 8%, surpassing expectations of $14.62 billion. Non-GAAP net income reached $4.0 billion, up 12% year-over-year, with non-GAAP EPS at $0.99, a 14% increase [1][8]. - The growth was primarily driven by strong demand for AI infrastructure and network upgrades, alongside several AI-oriented product launches. Cisco's competitive position in networking and AI has been further strengthened through strategic partnerships and continuous innovation [1][8]. - For the full fiscal year 2025, Cisco reported total revenue of $56.7 billion, reflecting a 5% year-over-year growth [1][8]. Summary by Sections AI Infrastructure - AI infrastructure has emerged as a significant growth driver, with web-scale customer orders exceeding $800 million in Q4, leading to cumulative orders of over $2 billion for FY25, far surpassing the initial target of $1 billion. Approximately $1 billion of revenue related to these AI orders was recognized in FY25, indicating effective order-to-revenue conversion [2][9]. - Orders from service providers and cloud customers surged by 49% year-over-year, with web-scale customers achieving triple-digit order growth for four consecutive quarters, highlighting persistent demand [2][9]. Networking Segment - The networking segment experienced a 12% year-over-year revenue growth in Q4, with double-digit order growth recorded for four consecutive quarters. Newly launched products, such as the Catalyst 9K smart switches, are positioned to create AI-ready networks [3][10]. - The adoption of Wi-Fi 7 products has accelerated significantly, showing triple-digit year-over-year growth. Additionally, ruggedized Catalyst devices for industrial IoT have maintained double-digit order growth for five consecutive quarters, benefiting from local investments in manufacturing and critical infrastructure [3][10]. Security and Software - The security segment saw a 9% year-over-year revenue increase in Q4, driven by new and upgraded security products. The integration with Splunk has begun to yield synergies, with new customer acquisitions growing by approximately 14% year-over-year [4][11]. - The shift towards software and subscription services continues, with rising RPO and ARR, enhancing revenue visibility for FY26. Services revenue remained stable, with expectations for gradual recovery in FY26 [4][11]. FY26 Outlook - Management projects mid-single-digit revenue growth and a solid non-GAAP EPS range for FY26, supported by three core drivers: the AI strategy encompassing web-scale training back-end, enterprise inference/cloud, and network connectivity [5][12]. - The campus network refresh cycle and integrated security solutions are expected to support a recovery in enterprise IT spending. The ongoing transition to subscription and software models, along with Splunk synergies, will further enhance revenue predictability and profit structure [5][12][13].

Group 1 - Cisco Systems (CSCO.US) experienced a pre-market decline of 1.4% despite reporting fourth-quarter revenue and earnings per share that exceeded expectations [1] - Goldman Sachs indicated that Cisco's earnings per share forecast for the current fiscal year ranges from $4.00 to $4.06, slightly above the market expectation of $4.02 [1] - The revenue guidance for the current fiscal year is set between $59 billion and $60 billion, with a median growth of 5% year-over-year, aligning with earlier guidance of 4% to 6% growth [1] Group 2 - Goldman Sachs believes that investor expectations for revenue guidance in the current fiscal year may have upward potential, reflecting the equipment replacement cycle in campuses and contributions from artificial intelligence [1] - The outlook, while meeting expectations, is considered slightly disappointing by the market [1]

Core Viewpoint - Goldman Sachs reported that Cisco Systems' fourth-quarter revenue and earnings per share exceeded expectations, but the earnings forecast for the current fiscal year is between $4.00 and $4.06, compared to the market expectation of $4.02 [1] Financial Performance - Cisco's revenue guidance for the current fiscal year is set between $59 billion and $60 billion, with a median growth of 5% year-over-year, aligning with the earlier guidance of 4% to 6% growth [1] Investor Sentiment - Goldman Sachs believes that investor expectations for the current fiscal year's revenue guidance may have upward potential, reflecting the equipment replacement cycle in campuses and contributions from artificial intelligence, although the outlook is slightly disappointing [1] Earnings Forecast - Goldman Sachs raised its average earnings per share forecast for Cisco over the next three fiscal years by 5%, based on sustained strong demand in product segments and lower sales costs aligning with the company's gross margin guidance [1] Target Price and Rating - Goldman Sachs currently sets a target price of $71 for Cisco Systems, maintaining a "Neutral" rating [1]

Core Insights - INE has expanded its course offerings to align with Cisco's enhanced automation certification track, reflecting the increasing importance of network automation and security in enterprise environments [1][6] - Cisco's strategic repositioning includes full-stack automation solutions, controller-based automation, and the integration of artificial intelligence in automation workflows [2][4] - The transition from the DevNet certification program to a more traditional hierarchy under CCNA, CCNP, and CCIE Automation signifies a shift in the industry's perception of network automation and security [3][8] Company Overview - INE is a leading provider of IT training and network certification preparation, trusted by Fortune 500 companies and IT professionals globally [10] - The company emphasizes practical, lab-driven learning that equips students with job-ready skills, enhancing their career advancement opportunities [7][8] - INE's training portfolio already aligns closely with the new certification requirements, preparing students to leverage AI for predictive network management and threat detection [4][6] Course Development - INE is developing a dedicated ENAUTO v2.0 course tailored to the updated exam blueprint, featuring hands-on laboratories and real-world scenarios [5][8] - The new course will cover essential technologies such as YANG, NETCONF, RESTCONF, and telemetry, which are crucial for secure network automation [5][6] - Current DevNet Associate and Professional Core learning paths remain relevant and provide excellent preparation for the enhanced automation certification track [8][9]

Group 1 - Morgan Stanley has raised the target price for Cisco (CSCO.US) from $78 to $80 [1]