Market Overview - Major U.S. indices experienced significant declines, with the Dow Jones falling by 797.60 points (1.65%) to 47,457.22, the Nasdaq dropping 536.10 points (2.29%) to 22,870.36, and the S&P 500 decreasing by 113.43 points (1.66%) to 6,737.49 [1] - European indices also saw declines, with Germany's DAX30 down 355.55 points (1.46%) to 24,025.22, the UK FTSE 100 down 107.82 points (1.09%) to 9,803.60, and France's CAC40 down 8.75 points (0.11%) to 8,232.49 [2] Commodity Prices - Crude oil prices increased slightly, with light crude for December delivery rising by $0.20 to $58.69 per barrel (0.34%) and Brent crude for January delivery up $0.30 to $63.01 per barrel (0.48%) [2] - Gold prices fell by 0.55%, closing at $4,171.51, with intraday declines exceeding 1% [4] Currency Exchange Rates - The U.S. Dollar Index decreased by 0.34%, closing at 99.156. The Euro strengthened against the dollar, trading at 1.1635, while the British Pound also appreciated to 1.3190 [3] Federal Reserve Insights - Federal Reserve officials expressed differing views on monetary policy, with Kashkari indicating a preference for maintaining rates while acknowledging economic resilience, and Harker emphasizing the need for continued tightening to combat inflation [5][6][7] - The Fed's balance sheet has faced criticism, highlighting the importance of clear communication regarding its changes and implications [8] Economic Impact of Government Shutdown - Analysts predict that the current U.S. government shutdown will have a more severe economic impact than the previous shutdown in 2018-2019, with early indicators showing declines in beer and automobile sales [9] Company-Specific News - Tesla is reportedly developing support for Apple's CarPlay in its vehicles, marking a strategic shift to integrate a widely used feature [9] - Apple announced a new mini-program partner program, reducing its revenue share from 30% to 15% for qualifying app purchases, which may impact its competitive positioning in the app market [10] - Boeing's mechanics voted to accept a new contract proposal, ending a three-month strike that affected military aircraft production [11]

Group 1 - Futures for major stock indexes, including the Dow Jones Industrial Average, traded modestly lower after the government shutdown ended with President Trump's signing of a funding bill [1] - Walt Disney reported earnings that contributed to its decline in the stock market, indicating potential challenges ahead for the company [1] - Cisco's earnings exceeded expectations, and its outlook is above market views, driven by strong orders in the AI sector [4] Group 2 - Disney is inching toward a turnaround in 2026, with plans to boost content spending, which may impact its financial performance positively in the long term [4] - The streaming video industry is expanding, with Disney increasing its media footprint in collaboration with Netflix [4] - The stock market is observing a week ahead focused on Dow stocks and potential rebounds, indicating a volatile market environment [4]

Cisco is acquiring NeuralFabric, a Seattle-area AI startup founded by former Microsoft engineers that builds back-end software for companies to develop and deploy their own generative AI models. ...

Core Insights - Cisco Systems (CSCO) reported first-quarter fiscal 2026 non-GAAP earnings of $1 per share, exceeding the Zacks Consensus Estimate by 2.04% and reflecting a year-over-year increase of 9.9% [1] - Revenues reached $14.88 billion, surpassing the Zacks Consensus Estimate by 0.71%, with a year-over-year growth of 7.5% [2] Financial Performance - Total Annual Recurring Revenues (ARR) were $31.4 billion, up 5%, with product ARR growth of 7% [2] - Total subscription revenues amounted to $8 billion, representing 54% of Cisco's total revenues [2] - Total software revenue increased by 3% year over year to $5.7 billion [2] - Product revenues in Q1 were $11.08 billion, accounting for 74.4% of total revenues, with a year-over-year increase of 9.5% [5] - Service revenues were $3.81 billion, making up 25.6% of total revenues, and increased by 2.1% year over year [5] Segment Performance - Networking revenues were $7.77 billion, up 15% year over year [4] - Security revenues decreased by 2% to $1.98 billion [4] - Collaboration revenues fell by 3% to $1.06 billion [4] - Observability revenues increased by 6% to $274 million [4] Geographic Performance - Americas' revenues grew by 9% year over year to $8.99 billion [6] - EMEA revenues climbed by 5% year over year to $3.78 billion [6] - APJC revenues also increased by 5% year over year to $2.11 billion [6] Operating Metrics - Non-GAAP gross margin was 68.1%, expanding by 120 basis points year over year [7] - Non-GAAP operating income was $5.12 billion, reflecting an 8.4% year-over-year increase [8] - Operating margin improved by 30 basis points year over year to 34.4% [8] Balance Sheet and Cash Flow - As of October 25, 2025, cash and cash equivalents totaled $15.7 billion, down from $16.1 billion [9] - Total debt remained stable at $28.1 billion [9] - Cisco returned $3.6 billion to stockholders through share buybacks and dividends [10] Guidance - For Q2 fiscal 2026, Cisco expects non-GAAP earnings between $1.01 and $1.03 per share, with revenues projected between $15 billion and $15.2 billion [11] - For the full fiscal 2026, non-GAAP earnings are expected to be between $4.08 and $4.14 per share, with revenues anticipated between $60.2 billion and $61 billion [12]

Group 1: Market Overview - Major U.S. equities indexes experienced a decline, with technology shares significantly impacting the Nasdaq, which fell nearly 2% [1] - The S&P 500 and Dow Jones Industrial Average also reported lower performance following the end of the longest federal shutdown in U.S. history [1] Group 2: Company Performance - Cisco Systems (CSCO) saw its stock surge over 4% after the company raised its full-year profit outlook [3] - The Walt Disney Co. (DIS) shares dropped 9% due to weaker-than-expected revenue, particularly in its linear TV networks business [2] - Flutter Entertainment (FLUT) stock fell 11% after the company revised its full-year revenue and adjusted EBITDA forecasts downward [2] - WEBTOON Entertainment (WBTN) shares plummeted 25% after projecting a decline in fourth-quarter revenue [2] - Sealed Air (SEE) shares soared 19% following reports of potential talks with private-equity firm Clayton Dubilier & Rice for a private acquisition [3] - Firefly Aerospace (FLY) shares jumped 17% after posting better-than-expected results and a positive full-year revenue projection [3] Group 3: Commodity and Currency Movements - Oil futures rose nearly 1%, trading just above $59 per barrel [3] - Gold futures remained relatively unchanged at around $4,200 per ounce [3] - The yield on the 10-year Treasury note increased to 4.10% [3] - The U.S. dollar weakened against the euro, pound, and yen [3] - Cryptocurrency prices were mixed, with Bitcoin trading under $101,000 [3]

In the year 2000, Cisco was one of the original four horsemen of technology. Based on the numbers you gave and what you said on the call. Do you feel like customers, the new ones and investors now understand Cisco's place in this new era.But first of all, thanks for having me. And, you know, I'm super proud of what the teams have accomplished. We had a record quarter and set ourselves up for what's likely going to be the best year we've ever had.So it was a it was just a great performance. And as I've been ...

Core Insights - Cisco has achieved a record quarter and is positioned for its best year ever, reflecting strong performance and customer confidence in its technology [1][2][19] Customer Engagement - The company is seeing significant spending from hyperscalers, which are advanced customers that conduct deep analyses before making technology decisions, indicating strong trust in Cisco's innovation [2][3] - New customer acquisitions include major hyperscalers in the U.S. and sovereign deals in the Middle East, with expansion into neo cloud markets in Europe and Southeast Asia [4][5] Financial Performance - Cisco reported $1.3 billion in business from top hyperscalers, with a focus on five key companies known for their strong cash flow [5] - The company has over $2 billion in its pipeline for neo cloud, sovereign cloud, and enterprise solutions, indicating a robust growth trajectory [6] Technology and Innovation - Cisco's technology evolution starts with hyperscalers, moving through telco spaces and into enterprise, showcasing a natural progression in technology adoption [7] - The company has made significant investments in software, particularly in security, and has seen growth in next-generation firewalls and Splunk products [10][12] Market Dynamics - The current market differs from 2000, as today's customers have strong financials and view technology investments as essential rather than optional [15][16] - There is a substantial opportunity for growth in AI and security, with the company open to both organic and inorganic strategies to enhance its offerings [14][18]

Market Overview - Major stock indices have experienced significant declines, with the Nasdaq down 417.09 points or 1.8 percent, the S&P 500 down 77.00 points or 1.1 percent, and the Dow down 351.82 points or 0.7 percent [2] - The Dow's pullback is attributed to a sharp decline in Disney's shares, which fell by 9.7 percent following the company's fiscal fourth quarter earnings report that exceeded analyst estimates but showed weaker-than-expected revenues [2] Sector Performance - Tech stocks are under pressure, with notable declines in Nvidia, Broadcom, and Alphabet, reflecting ongoing valuation concerns [3] - The NYSE Arca Computer Hardware Index dropped by 5.1 percent, while the Philadelphia Semiconductor Index fell by 3.5 percent, indicating substantial weakness in the semiconductor sector [4][5] - Networking stocks also declined, with the NYSE Arca Networking Index down by 3.0 percent despite positive earnings from Cisco Systems [5] - Other sectors such as brokerage, airline, and gold stocks have shown notable declines, while energy and pharmaceutical stocks have bucked the overall downtrend [5] Economic Context - The uncertainty in the market is compounded by the potential delay in the release of key U.S. economic reports due to the recent government shutdown, leaving traders and the Federal Reserve without critical data [4] - The yield on the benchmark ten-year treasury note has increased by 2.1 basis points to 4.100 percent, indicating a shift in the bond market following a previous rise [6] International Markets - In contrast to the U.S. market, stocks in the Asia-Pacific region mostly moved higher, with Japan's Nikkei 225 Index rising by 0.4 percent and China's Shanghai Composite Index advancing by 0.7 percent [5] - Major European markets, however, have declined, with the German DAX Index down by 1.2 percent, the U.K.'s FTSE 100 Index down by 1.0 percent, and the French CAC 40 Index down by 0.1 percent [6]

Financial Performance & AI Orders - Cisco achieved a record quarter with strong performance across geographies, technology areas, and customer segments [4] - Cisco secured $13 billion in AI infrastructure orders from hyperscalers, expecting to double last year's total of just over $2 billion in this area [2][3] Security Business & Accounting - Cisco acknowledges the need for faster progress in its security business [8] - Revenue recognition in security is affected by the shift from on-premise Splunk to cloud-based Splunk, with cloud deals recognized over the contract life [6] - Strong demand is seen in new firewalls and refreshed security products [7] AI & Partnerships - Cisco has a strong partnership with Nvidia, collaborating on AI infrastructure and developing an Ethernet switch with Nvidia's Spectrum X silicon, expected in the second half of the fiscal year [9] - Cisco is expanding its ecosystem partnerships, including collaborations with Middle East sovereign clouds like G42 and Humane [10] - Cisco views itself as a neutral ecosystem partner in the AI space [10] Market Perspective & Future Outlook - Cisco believes that the current AI investment boom is different from the 1999-2000 era, as it is driven by companies with strong balance sheets, cash flow, and profitability [12][13] - Cisco believes it is still early in the AI revolution, with significant potential in physical AI, robotics, and agentic technologies [13][14] - Cisco expresses confidence in the balance of the year, citing the acceleration of its teams' work and the uptake of its silicon strategy in the AI infrastructure space [20][21]

Core Insights - Cisco reported a strong quarter with significant growth driven by AI infrastructure orders, achieving $1.3 billion in AI orders from hyperscalers, which is expected to double compared to the previous fiscal year [3][4] - The company experienced a broad uptake in its campus refresh initiatives and strong performance across various geographical regions, technology areas, and customer segments [4] - Cisco's partnership with Nvidia has been fruitful, with plans to develop an Ethernet switch utilizing Nvidia's silicon, indicating a commitment to expanding its ecosystem partnerships [9][10] Financial Performance - Cisco's revenue from AI infrastructure orders reached $1.3 billion, a substantial increase from just over $2 billion in total AI orders last fiscal year, indicating a robust demand in the hyperscaler segment [3] - The company acknowledged challenges in its security division but noted strong demand for new firewall products and a positive outlook for future growth [6][7][8] Market Position and Strategy - Cisco's CEO emphasized that the current spending environment is driven by companies with strong balance sheets and profitability, contrasting it with the dot-com bubble era [12][13] - The company is focused on expanding its presence in the AI infrastructure space and is optimistic about the long-term potential of AI technologies, suggesting that the market is still in its early stages [14][20] - Cisco is actively engaging with various cloud providers, including partnerships with Middle Eastern sovereign clouds, to enhance its market position [10]