Cisco Smashes Q3 FY2026 With Record $15.8B Revenue and $2.1B in AI Orders - Is CSCO a Buy at $102?

The $15.8B revenue number is a clean win. It represents 12% annual growth and clears consensus estimates with room to spare. The non-GAAP EPS of $1.06 also clears the bar. The headline number for the quarter is AI infrastructure at $2.1B. Hyperscalers were ordering $2.1B from Cisco in the quarter with Cisco Silicon One portfolio, advanced networking solutions and optical products for AI data centers. And the $2.1B revenue from Q3 orders isn’t backlog. It is the first quarter of a multi-year upgrade cycle, and management guided for $9B in AI infrastructure to FY26. In FY25 it was $2B. 

The upgrade from $2B to $9B in a year is what excites the street and moves the stock. To Cisco, it is proof positive the company is on track as a leading AI infrastructure provider. For analysts, it is a fundamental story that requires the market to re-evaluate a dividend stock for a new era of tech.

Cisco is not a chip company. Cisco provides the network, not the chips themselves. This means Cisco supplies the infrastructure for hyperscalers to assemble 100,000+ GPU clusters by providing the switching and routing gear in every data center. The $2.1B orders in the quarter will fuel a multi-year upgrade cycle for enterprise data centers to AI data centers as the world transitions to AI.

The 4,000 job cuts aren’t a negative. Cisco is reorganizing to focus resources on silicon, optics, security and AI. The 4,000 job cuts are about 5% of the workforce and notifications will be distributed beginning May 14. Cisco said affected employees will receive severance and bonuses, as well as training in AI.

It is a common practice, and the stock moved higher, not lower. Cisco CEO Chuck Robbins described the action as a shift of focus and resources into growth sectors like silicon and AI as well as more traditional business segments. “This is not a company that is cutting costs because they’re not growing their business,” a source said, noting 12% annual growth is the opposite of that.

Cisco (CSCO) $102.26 is the daily chart above 1.618 Fib at $97.43, the purple MA resistance, and the ascending channel in yellow from the March low at $73.35. The yellow and cyan MAs are also acting as support at the bottom of the triangle at $92 to $97. The RSI is rising in positive divergence off its lows to near overbought territory.

Cisco (CSCO) Price Chart - Source: Tradingview

CSCO will test at $103.12 (Fib 2.0), then next at $107.16 and $112.31. Support would be $97.43 and $94.98.

Trade Setup

• Long over $102.50
• CSCO targets $103.12, $107.16, $112.31
• Support is $97.43 to $94.98
• Stop out if daily closes under $97.40

Cisco is undertaking an intentional restructuring. The move isn’t a response to poor earnings, and isn’t being called a restructuring because of them. Given that revenue grew 12% year-over-year, with $2.1 billion in AI infrastructure orders in Q3, Cisco CEO Chuck Robbins stated that the restructuring is an intentional redirection of investment toward the company’s higher growth businesses, with an emphasis on silicon, optics, security, and AI infrastructure. Eligible workers affected by the cuts will be offered severance packages, bonuses, and access to the company’s training program on AI. Restructurings in companies that are reorganizing into growth from the top, rather than restructuring due to weak fundamentals, have historically resulted in share price re-rating. The move to reduce expenses in favor of the highest growth businesses is one of the factors behind today’s higher stock price, which is why CSCO is trading higher.

Cisco has raised its full-year fiscal 2026 AI infrastructure revenue forecast to $9 billion as a result of the Q3 results. Last fiscal year, Cisco made close to $2 billion in AI infrastructure revenue, which is over four times the prior year level. The Q3 quarter saw $2.1 billion in AI infrastructure orders, driven by demand for Cisco’s Silicon One networking products, optical transceivers, and other switching hardware that enable hyperscaler AI data center deployments at scale. On the call, Cisco executives attributed the strength in AI infrastructure demand to two primary factors: accelerating demand from hyperscalers and an enterprise networking equipment refresh cycle.

The technical setup looks good. CSCO broke above the 1.618 Fibonacci extension at $97.43 on the daily chart. RSI is approaching 70, and positive divergence on prior lows. CSCO trades with a bullish continuation scenario above the psychological round number of $102.50 with targets at $103.12 and $107.16, and stops below $97.40. On the fundamental level, Q3 revenue at a record level, $2.1 billion in AI orders in Q3, a raised full-year AI infrastructure forecast of $9 billion, and increased guidance on total revenue, provides the bulls with solid evidence of their position. The key risk is whether or not Cisco can execute on the restructure and whether the $9 billion AI forecast materializes if hyperscalers slow their spending.

Cisco’s Q3 FY2026 earnings report was a real inflection point. Revenue and AI orders both hit record levels, while Cisco raised its AI infrastructure forecast to $9 billion for the full year. It’s no longer about a strategic pivot to AI for CSCO, the transition is already underway. The 4,000 role cuts are about reducing the cost base to match Cisco’s new revenue mix. At $102, CSCO has broken the 1.618 Fibonacci extension with volume in the daily chart, with targets at $103.12 and $107 next. The story is simple: the company delivering the networks that underpin the AI buildout is entering the first few years of a multi-year revenue repricing higher.