Revenue

Q1 2026

$14.5B to $14.7B "

$14.65B to $14.85B "

raised

Non-GAAP Gross Margin

Q1 2026

67.5% to 68.5% "

67.5% to 68.5% "

no change

Non-GAAP Operating Margin

Q1 2026

33.5% to 34.5% "

33% to 34% "

lowered

Non-GAAP EPS

Q1 2026

$0.96 to $0.98 "

$0.97 to $0.99 "

raised

Non-GAAP Effective Tax Rate

Q1 2026

18% "

19% "

raised

Revenue

FY 2026

$56.5B to $56.7B "

$59B to $60B "

raised

Non-GAAP EPS

FY 2026

$3.77 to $3.79 "

$4 to $4.6 "

raised

AI Infrastructure Growth

Previously discussed across Q1 " " , Q2 " " " and Q3 " " " " with emphasis on strong orders from webscale customers and early-stage enterprise pipeline, but with ongoing uncertainty about revenue conversion timing.

Q4 highlighted record AI infrastructure orders exceeding $800 million in the quarter and over $2 billion year‐to‐date, with continued uncertainty in order conversion. " " "

Steady, record‐level order growth is observed with a persistent theme of order conversion uncertainty. The orders are growing dramatically even as revenue recognition remains a future challenge.

Robust Networking Business Growth & Data Center Modernization

Q1 discussed double-digit growth with strong momentum in data center switching and emerging AI infrastructure needs. " " " " " Q2 and Q3 emphasized consistent double-digit or even triple-digit growth in campus switching, enterprise routing, and industrial IoT, along with progress in AI-driven data center modernization " " " and. " " " "

Q4 reported double-digit growth in networking product orders and further highlighted AI-driven modernization initiatives in data centers via new smart switches and strategic partnerships. " "

Consistent robust growth remains, with an evolving focus on integrating AI solutions and modernizing data centers. Partnerships and new product introductions are reinforcing demand in traditional segments while enabling innovation for future cycles.

Evolving Cybersecurity Product Adoption & Mixed Organic Growth

Q1 and Q2 highlighted the launch and early adoption of new products like XDR, Secure Access, Hypershield, and integration with Splunk, with organic growth boosted by these innovations even as legacy products lagged " " " " and. " " Q3 reinforced advanced threat detection with AI integration and demonstrated significant revenue boosts in security. " " " "

Q4 emphasized strong adoption of refreshed products (SASE, XDR, HyperShield, AI Defense) and noted double-digit global security order growth, while legacy products continue to weigh on overall organic growth. " " "

New security innovations are driving increased adoption, yet legacy product drag continues to temper overall organic growth. The segment is evolving with strong new product momentum that is expected to improve market dynamics over time.

Tariff & Margin Pressure Challenges

In Q1, a one‐time duty drawback benefit improved margins significantly. " " Q2 discussions mentioned the impact of increased tariffs (e.g., 10% on China, 25% on Mexico) with planned mitigations. " " " Q3 highlighted the full cost of tariffs contributing to sequential gross margin pressure. " " " "

Q4 detailed tariff assumptions for FY2026 with minimal margin impact due to effective supply chain management. The full impact of tariffs is integrated into guidance and managed through mitigation efforts. " "

Persistent margin pressures exist due to tariffs, but Cisco's effective mitigation practices have contained the impact. The earlier one-time benefit is not repeatable, and the focus remains on managing ongoing tariff-induced costs.

Competitive Pressures from NVIDIA & White-Box ODMs

Q1 acknowledged NVIDIA as both a partner and competitor, emphasizing Cisco’s deep Ethernet expertise. " Q2 recognized emerging competition from NVIDIA and white-box ODMs but looked to integration opportunities with products like Hyperfabric and AI PODs. " " Q3 reiterated leveraging the partnership with NVIDIA while noting that most orders remain for integrated systems over white-box alternatives. " " "

Q4 did not provide any specific mention of competitive pressures from NVIDIA or white-box ODMs.

Earlier periods discussed competitive pressures which have been increasingly offset by strategic partnerships with NVIDIA. The absence of discussion in Q4 suggests that these pressures may have been mitigated or deprioritized relative to other topics.

Strategic Partnerships & Revenue Diversification

Q1 emphasized collaboration with NVIDIA (AI Compute Platform, AI Pods, Hyperfabric) and Splunk integration to enhance security and observability. " " " Q3 further underlined partnerships with NVIDIA, Middle East investments, and collaborations with groups like G42 and ServiceNow to drive diversified revenue streams. " " " Q2 provided limited explicit discussion on partnerships.

Q4 continued to stress strategic partnerships (with NVIDIA, AMD, and integration of Splunk) and highlighted diverse revenue streams through robust AI infrastructure orders and growth in security and observability segments. " " " "

There is a consistent and broad focus on leveraging strategic partnerships across periods to drive revenue diversification. Cisco is actively integrating AI and security capabilities while broadening market opportunities through diversified collaborations.

Flat Service Revenue Growth Concerns

Q1, Q2, and Q3 did not report significant concerns about service revenue growth; in fact, Q1 & Q2 noted moderate growth figures " " while Q3 reported a 3% increase. "

Q4 CFO explicitly addressed concerns about flat service revenue growth, attributing it to a deceleration after a strong previous period driven by backlog-clearance activities, but expressed confidence in an eventual pickup. "

An emerging concern in Q4, where service revenue growth appears to be flattening following previous strong performance. Management attributes this to normalization after earlier backlog ramp-ups and expects improvement moving forward.

Cyclicality in Traditional Networking (Campus Refresh & Federal Spending)

Q1 highlighted the upcoming campus refresh opportunities with WiFi 7 and noted delays in federal spending due to continuing resolution pressures. " " " Q2 demonstrated continued strong demand in campus switching and noted stable federal spending with limited impact. " " Q3 discussed the anticipated campus refresh with integrated security enhancements and noted mixed performance in federal spending, with some strength in DoD-related orders. " "

Q4 discussed the campus refresh cycle kicking in next year (notably with Cat9K smart switches) and observed that federal spending (especially in security) has impacted overall growth, while non-federal segments remain robust. " " "

Cyclicality remains a recurring theme. Campus refresh cycles are expected to drive future growth, whereas federal spending continues to be volatile—experiencing delays and pressure but expected to normalize once budget issues resolve. The narrative is consistent across periods with incremental nuances on timing and segmentation.