Networking giant raises revenue forecast, expands AI infrastructure investments, and targets hyperscaler growth
Cisco Systems (CSCO) shares surged more than 15% in premarket trading Thursday after the technology giant delivered a stronger-than-expected revenue outlook and announced workforce reductions as part of a broader strategic shift toward artificial intelligence infrastructure.
Cisco projected fiscal fourth-quarter revenue between $16.7 billion and $16.9 billion, significantly above Wall Street expectations of approximately $15.8 billion. The strong forecast signaled growing demand for the company’s networking and infrastructure solutions tied to the rapidly expanding AI market.
CEO Chuck Robbins said the company is repositioning itself to capitalize on the next wave of AI-driven technology spending. As part of that transition, Cisco plans to cut fewer than 4,000 jobs, representing under 5% of its global workforce. Management said the restructuring is intended to streamline operations while redirecting resources toward higher-growth AI opportunities.
Cisco is increasingly focusing on AI infrastructure markets, including networking silicon, cybersecurity, fiber optics, and data center technologies designed to support large-scale AI workloads. The company has also been integrating AI capabilities into its internal operations and expanding its product lineup for enterprise and hyperscale customers.
One of the biggest highlights from the report was Cisco’s updated hyperscaler outlook. The company now expects orders from major data center operators to reach approximately $9 billion in fiscal 2026, sharply above its prior target of $5 billion. The increase reflects accelerating spending by cloud providers and AI infrastructure operators racing to expand computing capacity for generative AI applications.
Investors responded positively to the results, viewing Cisco as one of the latest legacy technology companies successfully adapting to the AI investment boom. Shares of Cisco are now up roughly 30% year-to-date as Wall Street increasingly rewards companies tied to AI infrastructure, cloud networking, and enterprise computing modernization.
Cisco’s latest results reinforce how deeply AI spending is reshaping the technology industry, pushing companies to realign operations, products, and long-term strategies around next-generation computing infrastructure.
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