Cisco Stock Surges on Optimistic Full-Year Revenue Forecast and AI Demand

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Shares of Cisco (CSCO) jumped as high as 7.2% in extended trading on Wednesday, February 12, 2025, after the company released its fiscal second-quarter results and boosted its full-year revenue outlook.

The networking giant’s positive forecast is fueled by robust demand for its technology solutions, particularly in the burgeoning field of AI infrastructure and security.

Key Highlights:

• Financial Performance: Cisco reported a 9% year-over-year increase in revenue, reaching $14.0 billion for the quarter. Non-GAAP net income rose by 6% year-over-year to $3.8 billion, or $0.94 per share. However, GAAP net income saw a decrease of 8% year-over-year, settling at $2.4 billion, or $0.61 per share.
• Increased Guidance: Cisco now anticipates full-year revenue between $56 billion and $56.5 billion, up from the previous estimate of $55.3 billion to $56.3 billion. The company projects adjusted earnings per share to be in the range of $3.68 to $3.74, an increase from the earlier forecast of $3.60 to $3.66.
• AI Infrastructure Orders: Orders for AI infrastructure exceeded $350 million during the quarter, bringing the total for the first half of fiscal year 2025 to approximately $700 million.
• Dividend and Share Repurchase: Cisco’s board approved a 3% increase in the quarterly dividend to $0.41 per share and authorized an additional $15 billion for stock repurchases.
• Segment Performance: Security revenue surged by 117%, boosted by the acquisition of Splunk, while networking revenue dipped by 3%.

Cisco CEO Chuck Robbins highlighted the company’s advantageous position to leverage the increasing demand for AI, assisting customers in scaling network infrastructure, enhancing data capacity, and implementing advanced AI security measures.

Cisco CFO Scott Herren noted that Splunk’s integration positively impacted adjusted earnings per share sooner than anticipated.

Excluding Splunk, Cisco’s overall revenue would have experienced a 1% decline year-over-year.

The company’s projections for the third quarter of fiscal year 2025 include revenue between $13.9 billion and $14.1 billion, with non-GAAP EPS between $0.90 and $0.92.

As of Thursday’s market close, Cisco’s stock had risen 5% in 2025, while the S&P 500 index had gained approximately 3%.

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