Cisco (CSCO) stock hit a new 52-week high of $117.70 on Thursday, jumping as much as 14.6% after the company posted fiscal Q3 results that beat on both the top and bottom lines and delivered guidance that left Wall Street’s forecasts well behind.
Revenue came in at $15.84 billion, up 11.9% year-over-year and roughly $280 million above consensus. Non-GAAP EPS of $1.06 beat estimates by $0.02.
The bigger story, though, was AI.
AI orders for the quarter reached $1.9 billion — more than triple the $600 million booked in the same period last year. That brings the year-to-date total to $5.3 billion.
Management raised its full-year FY26 AI order outlook from $5 billion to $9 billion. For context, that’s 4.5 times what Cisco booked across all of fiscal 2025. The company also lifted its FY26 hyperscaler AI revenue target from $3 billion to $4 billion, with a suggestion it could reach $6 billion in FY27.
CEO Chuck Robbins confirmed five new hyperscaler design wins in the quarter, including the first deployments of Cisco’s Silicon One P200 chip in scale-across data centre configurations.
Networking revenue hit $8.8 billion, up 25% year-over-year. Service Provider and Cloud orders surged 105% year-over-year, with triple-digit growth across all five of Cisco’s leading hyperscaler customers.
Enterprise campus demand also picked up, as customers expanded infrastructure for inference workloads, AI agents, and security applications.
On the margin side, gross margins dipped 150 basis points sequentially to 66%. That was in line with expectations, driven by higher component costs that management said have now stabilized.
Cisco guided Q4 revenue between $16.7 billion and $16.9 billion — significantly above the Street’s $15.82 billion estimate. Non-GAAP EPS guidance of $1.16–$1.18 also topped the consensus forecast of $1.07.
Rosenblatt’s Mike Genovese, ranked in the top 1% of Wall Street analysts, raised his price target on CSCO from $100 to $150 — a new Street high — while keeping a Buy rating. That implies roughly 30% upside from current levels over the next 12 months.
Genovese noted that with two consecutive quarters of double-digit revenue growth, Cisco now “seems likely” to be a double-digit growth company. He also flagged the company has “other levers” to protect operating margins above 34% even if input costs rise.
The Street’s average price target sits lower at $124.54, implying around 8% upside. The analyst consensus is a Moderate Buy, based on 11 Buys and 6 Holds.
CSCO is up 54.8% year-to-date heading into Thursday’s session. Investors who put $1,000 into the stock five years ago would be sitting on roughly $2,225 today.
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