Key Highlights

  • Record revenue: Cisco posted record fourth-quarter fiscal 2026 Revenue of around $17.3 billion.
  • AI order surge: AI infrastructure orders reached several billion dollars over the fiscal year, driven by Data Center networking upgrades.
  • Custom silicon: Cisco's Silicon One chips and high-capacity switches sit at the center of its AI networking growth.
  • Revenue mix shift: A move toward higher-margin software and subscriptions is central to whether the AI order surge translates into durable growth.

Cisco Systems (NASDAQ:CSCO), long seen as a mature and steady technology company, has found itself back in a growth conversation thanks to artificial intelligence. The reason is simple: the vast data centres being built to train and run AI need enormous amounts of networking equipment, and Cisco is one of the biggest suppliers. For Nasdaq 100 investors, that makes it a less obvious but genuine beneficiary of the AI build-out.

What Cisco Does

Cisco makes the switches, routers and networking gear that move data around corporate networks, data centres and the internet, alongside a growing Business in Cybersecurity and software. It sits in the technology sector. For years it was viewed as a dependable, slow-growing provider of infrastructure, valued more for its Dividend and Cash Flow than for expansion. AI has changed that perception by creating fresh Demand for high-speed connections inside data centres.

An AI Order Surge

The scale of the shift showed up in Cisco's results. For its fourth quarter and full fiscal year 2026, reported in August, the company posted record revenue of around 17.3 billion dollars for the quarter and pointed to a sharp increase in orders tied to AI infrastructure, which reached several billion dollars over the year. Management described a networking upgrade cycle driven by AI, with its custom Silicon One chips and high-capacity switches at the centre. For a company whose growth had stalled, a multi-billion-dollar AI order book is a meaningful development.

Why it Matters for the Nasdaq 100

Cisco offers the index exposure to a different layer of the AI story: not the chips or the cloud services, but the plumbing that connects them. Its results help confirm whether the data-centre build-out is broad-based, since networking demand tends to accompany spending on processors and servers. As a large, cash-generative member of the benchmark, Cisco also provides a degree of stability, blending steady software and services revenue with a new growth angle that had been missing from its story.

The Risks to Weigh

Cisco faces stiff competition in networking, including from specialised rivals and from customers designing their own equipment. Much of its AI opportunity depends on a small number of very large buyers, so orders can be lumpy. Its traditional enterprise business is sensitive to corporate technology budgets, which tighten when the economy slows. Integrating acquisitions and shifting towards software and subscriptions brings execution risk. And expectations have risen, so any stumble in the AI narrative could weigh on the shares.

An Old Company, a New Cycle

There is a certain irony in Cisco's revival. For much of the past decade it was treated as a relic of an earlier internet era, a company whose best growth was behind it. The AI build-out has handed it an unexpected second act, reminding investors that infrastructure providers can benefit from technology shifts even when they do not create them. The challenge for Cisco is to convince the market that this is a durable cycle rather than a brief surge, and to show that its investments in software, security and its own chips can turn a hardware upswing into lasting, higher-quality growth.

What to Watch Next

Readers should track Cisco's AI infrastructure orders, the figure management has highlighted as evidence of the new demand, and watch whether that order book keeps growing. The mix between hardware and higher-margin software and subscriptions reveals the quality of its revenue. Commentary on enterprise spending shows how the core business is faring. Progress with its Silicon One chips and large customers indicates how competitive it remains in the data centre. Finally, watch margins and cash returns, because Cisco's appeal has long rested on dependable profitability, and investors will want reassurance that pursuit of AI growth does not come at the expense of the discipline behind its dividend.

An Infrastructure Provider's Second Act

Cisco's revival shows that being unfashionable is not the same as being irrelevant. The company spent years viewed as a slow-growing relic while newer names captured investor attention, and the AI build-out has reminded the market that someone still has to wire it all together. Converting that unexpected opportunity into durable, higher-quality growth, rather than a temporary order surge, is the task now in front of it.