Q4 2026 Cisco Systems Inc Earnings Call Transcript
Key Points
- Record fiscal 2026 revenue of $63.3 billion, up 12% year-over-year, with Q4 revenue of $17.3 billion, up 18%.
- Strong demand momentum with total product orders up 35% year-over-year in Q4, including triple-digit growth in hyperscaler orders.
- AI infrastructure revenue projected to grow to $7.5 billion in fiscal 2027, up from approximately $3.8 billion in fiscal 2026.
- Non-GAAP EPS growth of 23% in Q4 and 14% for the full year, demonstrating strong operating leverage.
- Security portfolio saw double-digit order growth in Q4, with over 6,400 net new customers for new security products since launch.
- Returned $12.7 billion to shareholders in fiscal 2026, representing 99% of free cash flow, and increased dividend for the 15th consecutive year.
- Non-GAAP gross margin declined 210 basis points year-over-year in Q4, driven by higher hardware mix and memory costs.
- Services revenue was flat year-over-year in Q4, with expectations for only low single-digit growth in fiscal 2027.
- Guidance for fiscal 2027 implies a deceleration in growth in the second half of the year due to tougher comparisons.
- Price increases, which contributed about 5 points to Q4 revenue growth, are expected to be lapped in fiscal 2027, potentially impacting growth.
- The company faces ongoing supply chain challenges, including memory costs and component availability, despite proactive management.
Welcome to Cisco's fourth quarter and fiscal year 2026 financial results conference call. At the request of Cisco, today's conference is being recorded, if you have any objections, you may disconnect. Now I would like to introduce Sami Badri, Head of Investor Relations. Sir, you may begin.
Good afternoon, everyone. This is Sami Badri, Cisco's Head of Investor Relations, and I'm joined by Chuck Robbins, our Chair and CEO; and Mark Patterson, our CFO. Cisco's earnings press release and supplemental information, including GAAP to non-GAAP reconciliations are available on our Investor Relations website. Today's call is also being live streamed on YouTube, LinkedIn and X. Following this call, we will also make the recorded webcast and slides available on our website.
Throughout today's call, we'll be referencing both GAAP and non-GAAP financial results. We will discuss product results in terms of revenue, and geographic and customer results in terms of
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