Cisco Reports Better-Than-Expected Q2 Results, Raises FY26 Outlook

Core Viewpoint - Cisco Systems reported strong fiscal second-quarter results, beating analyst estimates for both revenue and earnings per share, indicating robust performance and growth potential in a competitive landscape [2][3]. Financial Performance - Cisco's fiscal second-quarter revenue reached $15.35 billion, surpassing analyst expectations of $15.12 billion [2]. - Adjusted earnings for the second quarter were $1.04 per share, exceeding the forecast of $1.02 per share [2]. - Total revenue increased by 10% year-over-year, driven by a 14% rise in product revenue, while services revenue saw a slight decline of 1% [3]. - Networking product revenue surged by 21%, and Collaboration product revenue grew by 6%, although Security product revenue fell by 4% year-over-year [3]. - Cash flow from operations was $1.8 billion, down 19% year-over-year, with the company holding $15.8 billion in cash, cash equivalents, and investments at the end of the quarter [3]. Future Outlook - For the third quarter, Cisco projects revenue between $15.4 billion and $15.6 billion, compared to estimates of $15.18 billion [5]. - Adjusted earnings for the third quarter are expected to be between $1.02 and $1.04 per share, slightly below the estimate of $1.03 per share [5]. - Cisco raised its fiscal 2026 revenue guidance to a range of $61.20 billion to $61.7 billion, up from the previous guidance of $60.20 billion to $61 billion [5]. - The company also increased its full-year adjusted earnings guidance to a range of $4.13 to $4.17 per share, from a prior range of $4.08 to $4.14 per share [6]. Market Reaction - Following the earnings report, Cisco shares experienced a decline of 4.35% in after-hours trading, settling at $81.82 [7].