Core Insights - Cisco Systems' Security revenues decreased by 2% year over year to $1.98 billion in Q1 FY26, impacted by a shift to cloud subscriptions and lower revenues from older products [1][10] - New and refreshed products, which make up about one-third of Cisco's security portfolio, are expected to drive top-line growth, with mid-teens growth in demand for next-gen firewalls [2] - Splunk's annualized recurring revenues and product remaining performance obligations grew in double digits, enhancing Cisco's threat detection capabilities through integration with Cisco Extended Detection and Response (XDR) [3][10] Financial Performance - The Zacks Consensus Estimate for Q2 FY26 service revenues is $2.16 billion, indicating a 2.6% growth compared to the same quarter last year [4] - The Zacks Consensus Estimate for Q2 FY26 earnings is $1.02 per share, suggesting an 8.5% growth from the previous year [15] - The Zacks Consensus Estimate for FY26 earnings is $4.10 per share, indicating a 7.6% growth from FY25 [16] Competitive Landscape - Cisco faces significant competition in the security domain from Fortinet and Okta [5] - Fortinet is rapidly advancing its AI-powered security operations, with over 20 AI-driven solutions and a focus on secure AI usage [6] - Okta's offerings include AI-powered capabilities that are expected to drive a CAGR of 16% in revenues from FY23 to FY26, with projected revenues of $2.906 billion to $2.908 billion for FY26 [7] Stock Performance and Valuation - Cisco shares have appreciated by 30.8% over the past year, outperforming the broader Zacks Computer and Technology sector's return of 24.2% [8] - Cisco's stock is trading at a premium, with a trailing 12-month price/book ratio of 6.49X compared to the industry average of 6.13X [12] - Cisco currently holds a Zacks Rank 3 (Hold) [16]

Cisco Systems (NasdaqGS:CSCO) FY 2025 Annual General Meeting December 16, 2025 11:00 AM ET Company ParticipantsStefan Padfield - Executive Director of Free Enterprise ProjectSami Badri - Head of Investor RelationsEvan Sloves - SecretaryChuck Robbins - Chair and CEOSami BadriGood morning, ladies and gentlemen. Welcome to Cisco's 2025 Annual Meeting of Stockholders. This is Sami Badri, Head of Investor Relations, and I'm joined by Chuck Robbins, our Chair and CEO, and Evan Sloves, Secretary of the Company. Th ...

Cisco Systems (NasdaqGS:CSCO) FY 2025 Annual General Meeting December 16, 2025 11:00 AM ET Company ParticipantsStefan Padfield - Executive Director of Free Enterprise ProjectSami Badri - Head of Investor RelationsEvan Sloves - SecretaryChuck Robbins - Chair and CEOSami BadriGood morning, ladies and gentlemen. Welcome to Cisco's 2025 Annual Meeting of Stockholders. This is Sami Badri, Head of Investor Relations, and I'm joined by Chuck Robbins, our Chair and CEO, and Evan Sloves, Secretary of the Company. Th ...

Cisco Systems (NasdaqGS:CSCO) FY 2025 Annual General Meeting December 16, 2025 11:00 AM ET Speaker0Good morning, ladies and gentlemen. Welcome to Cisco's 2025 Annual Meeting of Stockholders. This is Sami Badri, Head of Investor Relations, and I'm joined by Chuck Robbins, our Chair and CEO, and Evan Sloves, Secretary of the Company. The matters we'll be discussing today include forward-looking statements, which are subject to the risks and uncertainties that we discussed in detail in our documents filed with ...

Core Insights - Broadcom (AVGO) and Cisco Systems (CSCO) are experiencing strong demand due to the growth of AI infrastructure, data center expansions, and increasing cybersecurity threats [1][2][3] - Both companies are well-positioned to benefit from projected AI spending, which is expected to reach $1.48 trillion in 2025 and $2.02 trillion in 2026, compared to $987 billion in 2024 [3] Company Performance - Broadcom's AI revenues are projected to increase by 66% year-over-year to $6.2 billion in Q4 fiscal 2025, driven by demand for XPUs and Ethernet products [7][8] - Cisco's AI infrastructure orders reached $2 billion in fiscal 2025, doubling previous expectations, indicating strong market demand [11][12] Product and Technology Developments - Broadcom's XPUs, which are essential for training Generative AI models, accounted for 65% of its AI revenues in Q3 fiscal 2025, with a consolidated backlog of $110 billion [7][10] - Cisco is expanding its AI portfolio with new solutions such as the Unified Nexus Dashboard and 400G bidirectional optics, enhancing its data center capabilities [11][12] Strategic Partnerships - Cisco's partnership with NVIDIA aims to create AI-ready data center networks, integrating Cisco Nexus switches with NVIDIA's Spectrum-X architecture for improved performance [12][13] Earnings Estimates - The Zacks Consensus Estimate for Broadcom's fiscal 2025 earnings is $6.72 per share, reflecting a 38% increase over fiscal 2024 [14] - Cisco's fiscal 2026 earnings estimate has increased to $4.04 per share, suggesting a 6% growth over fiscal 2025 [15] Valuation Insights - Both companies are considered overvalued, with Broadcom trading at a forward price/sales ratio of 20.18X, significantly higher than Cisco's 4.69X [17] Future Outlook - Cisco's aggressive AI initiatives and expanding portfolio are expected to drive top-line growth, while Broadcom's partnerships and AI portfolio expansion are key catalysts for future performance [20]

Core Insights - Cisco Systems' security business is experiencing significant growth, with revenues increasing by 59% in fiscal 2025 to $8.09 billion, representing 19.5% of total revenues [1][10] - The acquisition of Splunk has enhanced Cisco's security offerings, particularly in Threat Intelligence, Detection, and Response (TIDR) and Extended Detection and Response (XDR) [2][10] - Cisco's security revenues for Q4 fiscal 2025 reached $1.95 billion, a 9% year-over-year increase, driven by the integration of Splunk and the expansion of Secure Access Service Edge (SASE) solutions [3][10] Security Business Performance - The integration of Splunk has led to a 14% year-over-year growth in new logos for Splunk, with Cisco adding 750 new customers through its security solutions in the reported quarter [3][10] - Orders for Cisco's security business grew in the mid-single digits, indicating positive growth prospects [3] Future Estimates - The Zacks Consensus Estimate for Q1 fiscal 2026 service revenues is projected at $2.24 billion, reflecting an 11% growth compared to the previous year [4] - The earnings estimate for Q1 fiscal 2026 is set at 98 cents per share, suggesting a 7.7% increase from the same quarter last year [13] - For fiscal 2026, the earnings estimate is $4.04 per share, indicating a 6% growth from the prior year [14] Competitive Landscape - Cisco faces strong competition in the security sector from companies like Fortinet and Okta, which have established innovative portfolios and strong market positions [5][6][7] - Fortinet is recognized for its extensive AI capabilities and has evolved into a comprehensive security ecosystem [6] - Okta's AI-powered offerings are gaining traction, particularly in identity management and security [7] Stock Performance - Cisco's stock has appreciated by 18.6% year-to-date, underperforming the broader Zacks Computer and Technology sector, which has returned 24% [8][9] - Cisco's stock is currently trading at a premium, with a trailing 12-month price/book ratio of 5.93X compared to the industry's 5.69X [15]

Core Insights - Cisco Systems (CSCO) shares are trading close to their 52-week high, driven by aggressive AI initiatives and growing security dominance [1] - AI Infrastructure orders from webscale customers reached $2 billion in fiscal 2025, doubling initial expectations, although networking revenues declined by 3% [2][9] - Year-to-date, CSCO shares have appreciated 17.4%, underperforming the broader sector and peers like Broadcom and Arista Networks [3] Stock Performance - CSCO shares closed at $69.52, near the 52-week high of $72.55 [1] - The stock is trading at a premium with a forward 12-month price/sales ratio of 4.57X, compared to the industry average of 4.33X [7] - Despite the premium valuation, CSCO shares are trading at a discount compared to Arista Networks and Broadcom, which have higher price/sales ratios [11] Growth Drivers - Cisco's AI push and security business are significant growth drivers, with strong demand for Cisco Secure Access, Hypershield, and XDR [12][14] - The partnership with NVIDIA enhances Cisco's AI capabilities, integrating Nexus switches with Spectrum-X for improved AI data center networks [13] - New product introductions, such as the Cisco 8223 routing system and enhancements to the Webex portfolio, are expected to support growth [17][16] Financial Guidance - For fiscal 2026, Cisco projects revenues of $59-$60 billion, up from $56.7 billion in fiscal 2025, with expected non-GAAP earnings between $4.00 and $4.06 per share [19] - The Zacks Consensus Estimate for fiscal 2026 revenues is $59.58 billion, indicating a year-over-year growth of 5.2% [20] Investment Outlook - An expanding portfolio positions Cisco for sustained growth in the tech landscape, particularly in AI and security [21] - The company holds a Zacks Rank 2 (Buy), suggesting favorable conditions for investors to accumulate shares [22]

Core Insights - Cisco Systems (CSCO) shares are currently trading at a premium with a Value Score of D, reflecting a forward 12-month price/sales ratio of 4.45X, which is higher than the Zacks Computer Networks industry's 4.16X but lower than Arista Networks (18.19X) and Broadcom (21.43X) [1][4][18] Stock Performance - Year-to-date (YTD), CSCO shares have appreciated by 13.8%, underperforming the broader Zacks Computer & Technology sector (15.9%) and peers Broadcom (46.1%) and Arista Networks (28.4%) [4][7] - Since the fourth-quarter fiscal 2025 results were reported on August 13, CSCO shares have dropped by 4.4%, attributed to slowing momentum in networking revenues, which grew by 12% year-over-year to $7.63 billion [5][6] Growth Drivers - AI Infrastructure orders from webscale customers reached $2 billion in fiscal 2025, doubling management's forecast, with over $800 million in orders reported in the fourth quarter [7][9] - Cisco's partnership with NVIDIA is expected to enhance AI capabilities, integrating Cisco Nexus switches with NVIDIA's Spectrum-X architecture for improved networking solutions [11][12] - Networking product orders have shown double-digit growth for four consecutive quarters, driven by demand in webscale infrastructure, switching, enterprise routing, and industrial IoT [13] Security Business - Cisco's security business is experiencing strong demand, with mid-single-digit growth in orders for Cisco Secure Access, Hypershield, and XDR, and a reported 14% year-over-year growth in new logos for Splunk [14] Financial Guidance - For fiscal 2026, Cisco expects revenues between $59 billion and $60 billion, up from $56.7 billion in fiscal 2025, with non-GAAP earnings projected between $4.00 and $4.06 per share [16] - The Zacks Consensus Estimate for fiscal 2026 revenues is $56.58 billion, indicating a year-over-year growth of 5.2%, while earnings are expected to grow by 6% to $4.04 per share [17] Market Position - Cisco's expanding portfolio and focus on AI and security position the company for sustained growth in a changing tech landscape, despite facing challenges from stretched valuations and competitive pressures [18][19]

Core Insights - The cybersecurity landscape is rapidly evolving, with Fortinet (FTNT) and Cisco Systems (CSCO) as key competitors in the network security market, which is projected to grow from $24.95 billion in 2025 to $42.93 billion by 2030, at a CAGR of 11.47% [1][8] Fortinet (FTNT) Overview - Fortinet's investment thesis is based on its strong execution and focused strategy in the high-growth security market, reporting Q2 revenues of $1.63 billion, a 14% year-over-year increase, and billings of $1.78 billion, up 15% [3][4] - The company boasts industry-leading non-GAAP operating margins of 33% in Q2, reflecting operational efficiency, and has raised its full-year 2025 billings guidance to $7.325-$7.475 billion [4] - Fortinet's competitive edge comes from its FortiAI innovations, with over 500 AI patents, and its recognition in multiple Gartner Magic Quadrants, indicating its leadership in various security segments [5] - The company is successfully transitioning to recurring revenue models, with Unified SASE ARR growing 22% and Security Operations ARR expanding 35% year-over-year [5] - Fortinet's proprietary ASIC-driven architecture and recent product launches position it well to capitalize on the convergence of networking and security [6] Cisco Systems (CSCO) Overview - Cisco reported fiscal Q4 revenues of $14.67 billion, a 7.6% increase year-over-year, with product orders growing 7% across all regions [7][10] - The integration of Splunk enhances Cisco's observability capabilities but complicates its security innovation efforts, leading to operational challenges [10][11] - Cisco's fiscal Q1 2026 revenue guidance of $14.65-$14.85 billion suggests modest growth, with management acknowledging headwinds from tariffs and challenges in converting AI investments into revenue [10] - Despite introducing innovations, Cisco struggles to maintain relevance in pure security, with security revenue growth coming from a smaller base and including Splunk contributions [11] Valuation and Performance Comparison - Fortinet trades at a forward P/S ratio of 8.09X, significantly higher than Cisco's 4.49X, justified by Fortinet's superior growth profile and execution consistency [12][15] - Fortinet's revenues are projected to grow 13.29% to $6.75 billion in 2025, while Cisco's fiscal 2026 revenue growth is estimated at 5.19% to $59.59 billion [15] - Year-to-date, Fortinet shares have declined 20%, while Cisco's shares have gained 14.6%, indicating differing market perceptions of their respective strategies [15] Conclusion - Fortinet is positioned as a superior investment opportunity due to its focused security strategy, consistent double-digit revenue growth, and leadership in critical technologies [19] - Cisco's execution challenges and legacy portfolio complexity limit its near-term growth potential, making Fortinet's premium valuation justified [19]

Core Insights - Cisco Systems' security business is experiencing strong demand, particularly for Cisco Secure Access, Hypershield, and XDR, with mid-single-digit order growth in Q4 fiscal 2025 [1][2][10] - Security revenues reached $1.95 billion, reflecting a 9% year-over-year increase, driven by offerings from Splunk and SASE [2][10] - Cisco's collaboration with NVIDIA enhances its leadership in security by integrating Nexus switches with Spectrum-X architecture [3] Security Business Performance - Cisco's security revenues were $1.95 billion, up 9% year-over-year, with significant contributions from Splunk and SASE [2][10] - The company added 750 new customers in the reported quarter, with Splunk synergies contributing to a 14% year-over-year growth in new logos [1][10] - Excluding sluggish U.S. federal order growth, security order growth in the rest of the world increased by double digits in Q4 [2] Future Outlook - Cisco expects Q1 fiscal 2026 revenues between $14.65 billion and $14.85 billion, indicating a 6.7% growth from the previous year [4][10] - The Zacks Consensus Estimate for Q1 fiscal 2026 is set at $14.77 billion [4] - Earnings per share for Q1 fiscal 2026 are projected between 97 cents and 99 cents, suggesting a 7.7% year-over-year growth [14] Competitive Landscape - Cisco faces increasing competition from Broadcom and Okta in the enterprise security sector [5] - Broadcom's security offerings accounted for 44% of its revenues in Q2 fiscal 2025, with new tools aimed at improving security and operational efficiency [6] - Okta's AI-powered capabilities are gaining traction, enhancing its product offerings in identity security [7] Stock Performance and Valuation - Cisco shares have appreciated 16.7% year-to-date, outperforming the broader Zacks Computer and Technology sector's return of 12.9% [8] - Cisco's forward 12-month price/sales ratio is 4.59X, compared to the industry average of 4.31X, indicating potential overvaluation [12]