Cisco reported strong AI infrastructure order growth on May 13, 2026, raising its FY2026 AI order target to $9 billion（約1.4兆円） and AI revenue guidance to $4 billion（約6400億円）, alongside 25% year-over-year networking revenue growth. While the fundamentals are accelerating, the stock has already climbed 83.91% over one year and now trades at 41x trailing earnings, leaving limited room for upside without proof that AI orders convert to revenue without further margin erosion.
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Cisco raised its FY2026 AI infrastructure order target to $9 billion（約1.4兆円） from $5 billion（約8000億円） and AI revenue guidance to $4 billion（約6400億円） on its May 13, 2026 earnings report. Networking revenue grew 25% year over year to $8.81 billion（約1.4兆円） last quarter, with data center switching orders up more than 40%, marking the strongest top-line acceleration in years.
Why it matters
The networking company is benefiting from heavy demand for AI-era infrastructure, with CEO Chuck Robbins calling Cisco 'the critical infrastructure for the AI era.' However, the stock has already run 83.91% over one year while gross margins are contracting as lower-margin AI hardware takes a larger share of revenue, creating a valuation risk for new buyers.
What to watch
The next earnings report should clarify gross margin guidance in the 65.5% to 66.5% range and AI revenue conversion against the $4 billion（約6400億円） target. Analysts target $127.05, implying roughly 5% upside from the current $121.15 price, and a clean earnings report with margin stability could justify a more constructive stance.
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