SAN JOSE, August 11, 2026, 19:25 EDT – Cisco’s stock dropped on Wednesday as its results drew attention to a $3.7 billion rush of AI-related orders.
- Cisco’s stock dropped 1.75% ahead of Wednesday’s fiscal fourth-quarter results.
- Options are pricing in a move of about 7%, which would represent around $33 billion in market value.
- To meet its $9 billion AI-order target, fourth-quarter orders of roughly $3.7 billion are needed.
Cisco Systems, Inc. NASDAQ:CSCO dropped 1.75% to $120.43 on Tuesday. Traders anticipate a much bigger shift after earnings on Wednesday. Options are pricing in an approximate 7% move by Friday, equating to around $33 billion based on Cisco’s $474.67 billion market capitalization.
Cisco’s artificial-intelligence order target poses a greater challenge. The company disclosed $5.3 billion in hyperscaler AI orders as of April. To achieve the $9 billion full-year aim, approximately $3.7 billion in orders are needed in the July quarter.
The challenge is significant, standing at around 95% higher than the estimated third-quarter rate. Typical earnings outperformance could carry less weight than updates on orders and guidance for fiscal 2027.
| Market measure | Latest reading | Investor context |
|---|---|---|
| Regular close | $120.43, fell 1.75% | 7.6% below its 52-week peak |
| Preliminary after-hours price | $121.20, rose 0.64% | Active trading continued after hours |
| Options-implied move | Near 7% | Estimated range between $112 and $129 |
| Implied market-value swing | Near $33.2 billion | Based on a $474.67 billion market value |
U.S. markets finished regular trading. Cisco is set to release its results following the close on Wednesday. The stock has risen almost 60% year-to-date, making a conservative forecast more expensive.
| Fiscal Q4 metric | Latest forecast or guidance | Result from previous year |
|---|---|---|
| Revenue | $16.83 billion consensus | $14.7 billion |
| Adjusted EPS | $1.17 consensus | $0.99 |
| Cisco revenue guidance | $16.7 billion-$16.9 billion | Not applicable |
| Cisco adjusted EPS guidance | $1.16-$1.18 | Not applicable |
| Non-GAAP gross margin guidance | 65.5%-66.5% | Not applicable |
Market consensus is positioned close to the center of Cisco’s stated guidance. Analysts are forecasting revenue growth of around 15% to $16.83 billion. Adjusted profit is estimated at $1.17 per share, compared with $0.99 previously.
| AI order period | Hyperscaler orders | Sequential change |
|---|---|---|
| Fiscal Q1 | $1.3 billion | Not applicable |
| Fiscal Q2 | $2.1 billion | Rose 62% |
| Fiscal Q3, inferred | $1.9 billion | Dropped 10% |
| Fiscal Q4 needed for $9 billion target | $3.7 billion | Jumped 95% |
The third-quarter amount is based on estimation rather than direct disclosure from the company. Cisco reported a total of $5.3 billion for the first nine months, following $1.3 billion and $2.1 billion recorded in the initial two quarters.
April saw widespread demand, with total product orders increasing 35%, or 19% when excluding hyperscalers. Networking orders rose by more than 50%. Campus networking orders were up over 25%, and data-center switching recorded gains of more than 40%.
Cisco’s Chief Executive Chuck Robbins stated the company experienced “very strong, broad-based demand for our products.” Cisco has also increased its AI order goal for the full year to $9 billion. Cisco’s third-quarter release
| Analyst recommendation | Count | Share of 15 ratings |
|---|---|---|
| Buy | 11 | 73% |
| Hold | 4 | 27% |
| Sell | 0 | 0% |
| Average price target | $136.23 | 13.1% higher than Tuesday’s finish |
| Target range | $121-$150 | Potential gain of 0.5% to 24.6% |
Wall Street sentiment remains upbeat. On Monday, Evercore ISI analyst Amit Daryanani reaffirmed a Buy rating with a $150 price target. UBS analyst David Vogt also maintains a Buy rating on Cisco and set a $132 target. However, UBS cautions that a cautious fiscal 2027 outlook might disappoint investors.
Margins provide another level of oversight. Cisco forecast a non-GAAP gross margin between 65.5% and 66.5%. The company also anticipates restructuring charges of $450 million in the fourth quarter. Cash returns continue to be solid, with $9.6 billion in remaining repurchase authorization as of April.
Risks: AI order sizes tend to be substantial but inconsistent. If a handful of hyperscalers delay purchases, it may hide true demand levels. A cautious outlook for fiscal 2027, shrinking margins, or a reduction in campus investments could weigh on the share price, even if the company surpasses quarterly expectations.
The upcoming session will assess a comprehensive setup. Cisco needs to demonstrate that AI demand is increasing rapidly to meet its target. The guidance could determine the main movement.
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