Q3 2026 Cisco Systems Inc Earnings Call Transcript
Key Points
- Cisco Systems Inc (CSCO) reported record revenue of $15.8 billion in Q3, up 12% year-over-year, driven by strong demand for AI infrastructure and campus networking solutions.
- Product orders grew 35% year-over-year, with hyperscaler orders growing triple digits, indicating robust demand across various customer segments.
- The company's AI infrastructure orders from hyperscalers totaled $1.9 billion in Q3, significantly exceeding prior expectations, with a strong pipeline for future growth.
- Cisco Systems Inc (CSCO) saw double-digit growth in its networking portfolio for the seventh consecutive quarter, highlighting the strength of its product offerings.
- The company is making strategic investments in silicon, optics, security, and AI, positioning itself well for future growth opportunities in these key areas.
- Services revenue was down 1% year-over-year, primarily due to the timing of service contract start dates.
- The transition in the Splunk business from on-premise deals to cloud subscriptions is creating a near-term drag on revenue growth.
- Non-GAAP gross margin decreased by 260 basis points year-over-year, impacted by product mix and higher memory costs.
- The decline in the prior generation security portfolio continues to offset growth in new and refreshed products.
- The restructuring plan announced by Cisco Systems Inc (CSCO) involves up to $1 billion in pretax charges, indicating potential short-term financial impacts.
Welcome to Cisco's third 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 and LinkedIn.
Following this call, we'll 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 product orders
| Access to All Earning Calls and Stock Analysis | |
| 30-Year Financial on one screen | |
| All-in-one Stock Screener with unlimited filters | |
| Customizable Stock Dashboard | |
| Real Time Insider Trading Transactions | |
| 8,000+ Institutional investors’ 13F holdings | |
| Powerful Excel Add-in and Google sheets Add-on | |
| All data downloadable | |
| Quick customer support | |
| And much more... |
Trustpilot
We'd love to learn more about your experiences on GuruFocus.com and how we can improve!
Take Survey
