Cisco's Earnings Impress But Stock Dips Giggety

• Cisco reports strong Q4 earnings, exceeding analyst expectations in both EPS and revenue.
• Despite positive results, Cisco's stock drops due to cautious guidance for the current period.
• Growth in core networking and AI infrastructure orders, including deals with hyperscalers, signals strategic shifts.
• Cisco anticipates revenue acceleration from neoclouds in the coming years, alongside navigating memory price increases.

Giggity Good Numbers Cisco's Q4 Breakdown

Alright, alright, alright. Let's talk about Cisco's latest score, shall we? The tech giant just dropped its Q4 numbers, and, well, they're better than expected. We're talking earnings per share hitting $1.04 adjusted versus the expected $1.02. Revenue? A cool $15.35 billion, sailing past the $15.12 billion mark. That's what I call a victory. But hold your horses, because the market's reaction was as unpredictable as my dating life.

Stock Dips and AI Hopes What's Going On

Despite the strong figures, Cisco's stock took a dip, falling about 7% in extended trading. The reason? Earnings guidance for the current period only met estimates. Investors, always wanting more, seem a bit disappointed. Everyone's hoping Cisco will play a bigger role in the AI boom. Speaking of booms, have you seen the numbers for AI infrastructure orders? Cisco's sitting on $2.1 billion from hyperscalers. I'd like to hyperscale my dating life too. Remember, keeping an eye on tech stock jitters is important, especially when UBS sounds the alarm on AI disruption and overspending, as you can read more about in Tech Stock Jitters UBS Sounds Alarm on AI Disruption and Overspending.

Networking is King Giggity

Here's where things get interesting. Cisco's core networking revenue surged 21% year-over-year, reaching $8.3 billion. That's a lot of cables, routers, and whatnot. Turns out, the backbone of the internet is still a lucrative business. Who knew? Maybe I should get into the networking business myself. Imagine the possibilities.

Saudi Arabia and Nvidia A Budding Bromance?

Cisco's making moves on the global stage. They're teaming up with Advanced Micro Devices to provide products for an AI infrastructure project in Saudi Arabia. And they've launched a new networking switch packing an Nvidia chip. It's like a techy version of the Rat Pack, but with circuits and code instead of martinis and swing music. Giggity.

Neoclouds and Memory Prices The Future is Coming

According to Cisco CEO Chuck Robbins, revenue from neoclouds (those up-and-coming cloud providers) should start ramping up in the second half of the current fiscal year, with a bigger impact in fiscal year 2027. Plus, the rising price of memory due to Nvidia's GPU demand is causing ripples, leading Cisco to announce price hikes and adjust contracts. Inflation is a bitch. It effects everyone, including Quagmire.

Fiscal Year 2026 The Outlook

Looking ahead, Cisco is targeting $4.13 to $4.17 in adjusted earnings per share and $61.2 billion to $61.7 billion in revenue for fiscal year 2026, implying 8.5% growth. Analysts seem to be on the same page, with LSEG consensus showing earnings of $4.12 per share and $60.74 billion in revenue. So, while the stock dip might sting a little, the long-term outlook seems promising. Maybe I should invest. Giggity giggity goo.