Cisco stock up 64% as core business rebounds

Cisco's recent stock performance is attributed to more than just its AI-related sales. The company's traditional networking products—switching, routing, and wireless—are all in a refresh cycle simultaneously, a situation management says has not happened before. By fiscal Q4 2026, campus networking product orders were growing 20% year over year, with Wi-Fi 7 accounting for more than half of wireless orders. This broad-based recovery, coupled with price increases on hardware, helped revenue jump 18% in that quarter.

Management's guidance for fiscal 2027 indicates roughly 15% revenue growth, with the non-AI business expected to grow near 10% once the $7.5 billion hyperscale AI revenue is stripped out. The company is deliberately trading some gross margin for revenue, guiding operating margin near 35%, a company high. However, the market remains cautious, as the stock sits about 16% below its 52-week high, and growth implied for later fiscal 2027 is nearer 13% against harder comparisons. Investors will watch whether the company can continue to raise its guidance.