After years of dominating the network infrastructure market, Cisco Systems Inc. (NASDAQ: CSCO) is on a drive to optimize customer experience by harnessing artificial intelligence and machine learning technologies. The company will be reporting results for the second quarter on Wednesday, at 4:05 pm ET.

The San Jose-headquartered network gear maker’s stock has grown about 25% in the past year, with most of that coming in the last six months. The positive investor sentiment mainly reflects the company’s initiatives to tap into AI-related opportunities, like the acquisition of cybersecurity firm Splunk in early 2024.

The tech firm’s second-quarter report is expected on February 12, after the closing bell. The consensus estimates of Wall Street analysts suggest a 4.6% year-over-year increase in Q2 earnings to $0.91 per share. That reflects an anticipated 8.5% increase in revenues to $13.87 billion in the January quarter, which almost matches the company’s guidance of $13.75-13.95 billion. The management’s profit target for the quarter is $0.89-$0.91 per share.

Q1 Earnings Beat

In the first quarter, adjusted earnings declined to $0.91 per share from $1.11 per share in the same period of 2024, but exceeded analysts’ estimates. Unadjusted net income came in at $2.7 billion or $0.68 per share in Q1, compared to last year’s profit of $3.6 billion or $0.89 per share. At $13.8 billion, first-quarter revenues were down 6% year-over-year, broadly in line with Wall Street’s forecast.

Commenting on the Q1 results, Cisco’s CEO Charles Robbins said, “The strength of our operating performance and free cash flow in Q1 fueled a return of $3.6 billion in value to our shareholders through share repurchases and cash dividends, delivering on our commitment to consistent capital returns. Building on the growing demand we saw at the end of fiscal year ’24, product orders grew 20% year over year in Q1 and were up 9% organically. This is an acceleration of the 14% product order growth we saw just three months ago and is a clear sign of normalizing demand for Cisco’s innovation.”

AI Pipeline

Interestingly, Cisco’s quarterly results consistently beat estimates in recent years. However, the company reported lower revenue and profit for most of 2024 and early FY25 due to a dip in the demand for its networking products, mainly routers, switches, and wireless access points. As part of integrating AI into its cybersecurity portfolio, the company last month acquired SnapAttack, a privately held threat detection and engineering platform. It is worth noting that revenues of the Security business more than doubled in the most recent quarter.

Cisco has a strong AI pipeline and expects to exceed its target of securing $1 billion of AI orders this fiscal year from web-scale customers. A few months ago, the company raised its full-year 2025 revenue guidance to $55.3-$56.3 billion from the previous forecast in the range of $55.0 billion to $56.2 billion

Cisco’s stock was trading at $62.65 on Monday afternoon, after making modest gains in the early hours of the session. The average price for the last 52 weeks is $51.78.

The post Cisco’s AI initiatives in focus as it gears up to report Q2 2025 results first appeared on AlphaStreet.

After years of dominating the network infrastructure market, Cisco Systems Inc. (NASDAQ: CSCO) is on a drive to optimize customer experience by harnessing artificial intelligence and machine learning technologies. The
The post Cisco’s AI initiatives in focus as it gears up to report Q2 2025 results first appeared on AlphaStreet.