Cisco Systems, Inc.

Q3 results beat guidance (strong execution) - Revenue: $15.8B, +12% YoY (record). - Non-GAAP EPS: $1.06, +10% YoY, above the high end of guidance. - Products vs. services: Product revenue $12.1B (+17% YoY); Services $3.7B (-1% YoY) mainly from service contract timing. - Orders (demand signal): Total product orders +35% YoY; +19% YoY excluding hyperscalers (broad-based strength, not just AI).

AI infrastructure is the main growth engine; hyperscaler orders accelerating and raised full-year expectation - Hyperscaler AI infrastructure orders: $1.9B in Q3 vs $0.6B prior year. - FY26 AI infrastructure orders expectation: now ~$9B from hyperscalers (up from prior expectation of ~$5B), i.e. ~4.5x FY25 total. - FY26 AI infrastructure revenue expectation: ~$4B revenue to be recognized from hyperscalers (important because orders and revenue timing differ). - Non-hyperscaler AI orders: additional ~$300M in Q3 from Neocloud/Sovereign/Enterprise; ~$900M YTD and ~$3B pipeline. - Acacia (coherent pluggable optics): > $1B Q3 orders, on track for >200% YoY growth in FY26; >750,000 units shipped at 400G and >40,000 at 800G; #1+ design momentum with multiple new hyperscaler design wins.

Cisco sees demand durability beyond AI hyperscalers—enterprise modernization tied to AI + security - Networking orders: grew >50% YoY in Q3, and networking has 7 straight quarters of double-digit growth. - Enterprise: product orders +18% YoY; public sector +27% YoY with double-digit growth across geographies. - Service provider/cloud acceleration: orders +105% YoY; telco orders +9% YoY (AI-driven network modernization). - Campus refresh: wireless orders +40% YoY; strong WiFi 7 ramp (WiFi 7 is ~half of wireless mix in Q3). - Durability comments (investor “pull-forward?” question): management says any pull-forward is modest; ex-hyperscaler order growth accelerated from ~10% in Q2 to ~19% in Q3, with acceleration attributed to real demand plus pricing, not only supply constraints.