Cisco Earnings Preview: Eyes on Networking Growth Amid Rising AI Datacenter Demand

Cisco Systems (NASDAQ:CSCO), a global leader in networking and infrastructure, operates worldwide across traditional networking equipment and emerging AI infrastructure; having transitioned to a subscription-based model, it has surpassed $1B in AI infrastructure orders, advanced custom silicon development, and is well-positioned to capture growth from an expanding AI total addressable market, rising enterprise IT spending, and increased hyperscalers CAPEX.

The company topped revenue forecasts by 0.7% last quarter, reporting $14.15 billion—an 11.4% year-over-year increase—while it beat analysts’ EPS estimates for the next quarter but posted billings in line with expectations.

Key highlights

• Cisco’s emphasis on AI and advanced networking positions it to benefit from two major tech trends. Rising demand for AI infrastructure and increasingly complex enterprise networks offer significant growth opportunities for the company.
• AI orders have surged past $600 million, outpacing prior run rates, and continued corporate investment in AI and digital transformation could drive substantial revenue growth and expand Cisco’s market share.
• Cisco’s valuation is seen by some analysts as below peer levels, which could present a favorable investment opportunity.
• As a global company, Cisco faces geopolitical risks—especially US–China tensions—that could trigger trade restrictions, tariffs, and supply‑chain disruptions, raising costs and prompting customers to delay or reduce IT spending, which would weigh on revenue growth.

The networking and AI infrastructure markets are becoming fiercely competitive — tech giants and agile startups are fighting for shares, so Cisco’s ability to defend its networking leadership while also becoming a major AI infrastructure player is far from guaranteed.

CSCO Q4 2025 earnings after market Wednesday, August 13, 2025

Option Statistics

Put/Call ratio suggests the following three scenarios:

• With Put/Call ratio between 0.8882 to 0.2878 for the next two upcoming expiries suggest that the overall option traders are inclined to Calls.
• Lower earnings & guidance could trigger a sharp sell-off as option traders would start selling their Calls.
• Better-than-expected earnings & guidance would trigger a gradual rally.
• Option market is showing an exceptionally large net positive Gamma between 70 & 72.50 strikes versus a negative gamma exposure at 65 strike from August 2025 to January 2027.

Technical Analysis Perspective

• CSCO has climbed along a rising trendline from the Aug 2024 low of 44.50.
• That trendline was retested in Apr 2025 at 52.10 before the move up to 72.55.
• The current rally cleared the Dec 2021 high of 64.30.
• A longer-term rising trendline from the Jan 2019 high (58.26) crossed 64.30 in Dec 2021 and now intersects the price between ~72.25–73.60.
• The 73.00–73.50 zone is acting as a strong resistance band.
• A sustained break above 73.60 would target 77.20, with all‑time high near 82 (Mar 2000) as the next ceiling.
• Conversely, a rejection and a drop below the 68.00 base would target the rising trendline support around 59–56.

Weekly Candlestick Chart

CSCO Seasonality Chart

Since 2006, CSCO has experienced an average August gain of 2.2%, occurring in 55% of the years, while September has seen an average increase of 0.5% in 68% of the years.

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Ali Merchant is a seasoned financial market professional with expertise in Technical Analysis, Treasury & Capital Markets, Trading, Sales, Research, Training, Fund & Relationship Management, Fintech, and Digitalization. He is a CMT charter holder and an active member of CMT Association, USA, American Association of Professional Technical Analysts, and CMT Association of Canada. He has worked on various roles and organizations in North America and the GCC, such as ABN Amro bank, Thomson Reuters, Refinitiv, MAK Allen & Day Capital Partners, and Bridge Information Systems.

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