Cisco has raised its annual revenue forecast, driven by increased demand for networking equipment fueled by the AI boom.
The surge in data center investment, particularly in ethernet switches and routers, has been propelled by tech giants ramping up capital expenditure to support generative AI applications.
Cisco has secured AI infrastructure orders exceeding $600 million in the third quarter from web-scale customers, bringing the year-to-date total to over $1 billion, highlighting the strong revenue impact of AI-related infrastructure.
The company’s strengthened position in the cloud data center market has further contributed to its revenue outlook, with expectations of fiscal 2025 revenue between $56.5 billion and $56.7 billion, up from the previous range of $56 billion to $56.5 billion.
Additionally, adjusted per-share profit is projected to rise to $3.77 to $3.79, compared to the prior forecast of $3.68 to $3.74, reflecting the sustained revenue momentum driven by AI infrastructure investments.
“The momentum we are seeing with AI is fueled by the power of our secure networking portfolio, our trusted global partnerships, and the value we bring to our customers,” Chuck Robbins, chair and CEO of Cisco, said in the earnings report.
Cisco Systems, the enterprise networking major, has reported revenue of $14.15 billion (up 11 percent) for the quarter ended April 26.
The Networking division generated $7,068 million in revenue, growing by 8 percent, while Security achieved the strongest growth, increasing by 54 percent to reach $2,013 million, indicating a strategic emphasis on cybersecurity solutions. Collaboration contributed $1,031 million, with a modest 4 percent growth, suggesting a more mature or competitive market segment.
Observability, with $261 million in revenue, saw a notable 24 percent increase, highlighting rising demand for monitoring and analytics solutions. Total product revenue rose by 15 percent to $10,374 million, whereas Services, accounting for $3,775 million, experienced the lowest growth rate of 3 percent, possibly reflecting market saturation or slower demand in service contracts. The overall performance underscores the significant impact of Security and Observability as key growth drivers within Cisco’s portfolio.
The Americas region led with $8,380 million in revenue, achieving 14 percent growth, indicating strong demand and market expansion. EMEA contributed $3,736 million with an 8 percent increase, suggesting steady but moderate growth in this region. APJC generated $2,034 million, growing by 9 percent, signaling consistent performance across Asia Pacific, Japan, and China. The overall revenue distribution underscores the Americas as the primary growth driver, while EMEA and APJC demonstrated stable yet comparatively lower growth rates.
Baburajan Kizhakedath
