Cisco Earnings: Q1 Fiscal 2027 Revenue Jumps 24% to $18.5 Billion as AI Networking Demand Lifts Outlook
Cisco earnings for the first quarter of fiscal 2027 came in ahead of Wall Street expectations late Thursday, as Cisco Systems (NASDAQ: CSCO) reported revenue of $18.5 billion, up 24% from a year earlier, and raised its full-year revenue and profit outlook on the back of surging demand for AI networking equipment. The company also lifted its target for AI infrastructure revenue from hyperscale cloud customers to $9 billion for the fiscal year.
Chair and CEO Chuck Robbins called it “the strongest revenue and non-GAAP earnings per share growth rates for Cisco in over 15 years.” Below is what the company reported, how it compares, and what comes next.
Cisco Earnings: Key Q1 Fiscal 2027 Numbers
Verified facts — from Cisco’s official Q1 FY2027 earnings release (quarter ended Oct. 24, 2026):
| Metric | Q1 FY2027 | Q1 FY2026 | Change |
|---|---|---|---|
| Total revenue | $18.52 billion | $14.88 billion | +24% |
| Product revenue | $14.67 billion | — | +32% |
| Services revenue | $3.85 billion | — | +1% |
| Networking product revenue | $11.13 billion | — | +43% |
| GAAP EPS (diluted) | $1.14 | $0.72 | +58% |
| Non-GAAP EPS | $1.40 | $1.00 | +40% |
| Non-GAAP gross margin | 65.6% | 68.1% | -2.5 pts |
| Non-GAAP operating margin | 37.8% | — | Record |
| Operating cash flow | $4.4 billion | $3.2 billion | +36% |
| Remaining performance obligations | $46.2 billion | — | +8% |
Among product categories, Cisco said Security revenue rose 7%, Collaboration 8% and Observability 2%. GAAP net income was $4.6 billion, up 59%, and non-GAAP net income was $5.6 billion, up 39%.
How the results compared with expectations
Third-party estimates: Consensus figures cited in press coverage called for revenue of roughly $18.1 billion and non-GAAP EPS of about $1.29, which Cisco exceeded on both counts. Published consensus figures vary somewhat by data provider.
Raised Guidance and the $9 Billion AI Target
Company guidance (forward-looking statements by Cisco, not facts):
- Q2 fiscal 2027: revenue of $18.0 billion to $18.2 billion; non-GAAP gross margin of 65% to 66%; non-GAAP operating margin of 36% to 37%; non-GAAP EPS of $1.34 to $1.36 (GAAP EPS $1.07 to $1.09).
- Full fiscal 2027 (raised): revenue of $74.8 billion to $75.8 billion; non-GAAP EPS of $5.47 to $5.53 (GAAP EPS $4.38 to $4.44).
- AI infrastructure from hyperscalers: Cisco now expects $9 billion in fiscal 2027, which it said is more than double the fiscal 2026 total.
CFO Mark Patterson said in the release: “The strength of our Q1 performance gives us confidence to raise our revenue and non-GAAP EPS guidance for FY27.” He added that the company is “unlocking significant operating leverage which is enabling us to grow earnings much faster than revenue.”
Capital returns
- Cisco returned $3.7 billion to shareholders in the quarter, including $2.0 billion in buybacks (about 18 million shares at an average price of $112.38).
- It declared a quarterly dividend of $0.42 per share, payable Jan. 20, 2027, to holders of record on Jan. 4, 2027.
- Remaining repurchase authorization stood at $6.1 billion.
- Cash and investments totaled $15.8 billion at quarter end. Cisco also said it closed its acquisition of WideField Security.
Company Background
Founded in 1984 and headquartered in San Jose, California, Cisco is one of the world’s largest makers of networking hardware, including the switches and routers that move data inside corporate networks, telecom carriers and data centers. Over the past decade it has expanded into security, collaboration (Webex) and observability software, the latter strengthened by its 2024 acquisition of Splunk. Its fiscal year ends in late July, so the quarter just reported covers August through late October 2026.
Why the Cisco Earnings Report Matters
Analysis: The quarter shows that the AI build-out is reaching well beyond chipmakers. Large AI clusters require high-speed networking to link thousands of accelerators, and Cisco’s 43% jump in networking product revenue suggests that spending is flowing to network equipment suppliers as well. Robbins framed the moment in the release as “the very early stages of a multi-year networking supercycle” — a company characterization, not an independent assessment.
The trade-off is margin. Non-GAAP gross margin fell 2.5 percentage points year over year, and product gross margin fell more steeply, a pattern often associated with a heavier mix of hardware sold to very large customers. Cisco offset that with tight cost control: non-GAAP operating expenses rose only 2%, helping deliver a record non-GAAP operating margin.
Market Context
The report landed in a volatile week for technology stocks. On Thursday, Nvidia announced that Jensen Huang had resigned as chief executive, and the Nasdaq Composite closed down 0.4%. Applied Materials also reported record quarterly revenue after Thursday’s close. Readers can follow the week’s market backdrop in our Monday stock market outlook, and see how other networking and infrastructure names reported in our coverage of Cloudflare’s Q3 earnings.
Developing: Early after-hours trading data from different providers showed mixed, modest moves in Cisco shares on Thursday evening. The regular-session reaction on Friday, Nov. 13, was not yet known at the time of writing.
What Comes Next for Cisco
- Jan. 4, 2027: record date for the $0.42 quarterly dividend; payment follows Jan. 20.
- Q2 fiscal 2027 results: expected in February 2027, when investors will check results against the $18.0 billion to $18.2 billion revenue guidance.
- Peer reports: Nvidia is scheduled to report quarterly results on Tuesday, Nov. 17, and Palo Alto Networks on Wednesday, Nov. 18, giving further reads on AI infrastructure and security demand.
Sources
- Cisco Investor Relations — Cisco Reports First Quarter Earnings (Nov. 12, 2026)
- Cisco Newsroom — Q1 FY2027 earnings release
- Startup Fortune — Cisco raises its 2027 forecast as AI networking orders accelerate
- StockTitan — Stock market today, Nov. 12, 2026
- Nvidia Newsroom — Nvidia announces CEO transition
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