Cisco Systems, Inc. (NASDAQ: CSCO) delivered a robust set of results for its fiscal third quarter of 2025, beating Wall Street expectations and raising its outlook for the year. The networking giant’s performance was powered by surging demand for AI infrastructure and security solutions, as well as the successful integration of its recent Splunk acquisition.
Revenue and Profitability Beat Expectations
For the quarter ending April 2025, Cisco reported revenue of $14.1 billion, an 11% increase from the same period last year and ahead of analyst forecasts. Net income on a GAAP basis climbed to $2.5 billion, up 32% year-over-year, while earnings per share (GAAP) jumped 35% to $0.62. On a non-GAAP basis, net income was $3.8 billion with EPS of $0.96, both handily beating consensus estimates.
AI and Security Drive Growth
A key highlight from the report was Cisco’s accelerating momentum in AI infrastructure. The company announced that it had surpassed its $1 billion AI infrastructure orders target a full quarter ahead of schedule, with $600 million in orders from Webscale customers in Q3 alone. Security solutions also saw strong uptake, reinforcing Cisco’s leadership in enterprise networking and cybersecurity.
Even excluding the impact of Splunk, product orders grew 9% year-over-year, demonstrating underlying demand strength across Cisco’s core business lines.
Raised Guidance and Shareholder Confidence
Buoyed by its strong results, Cisco raised its full-year revenue guidance to a range of $56.5 billion to $56.7 billion, up from prior forecasts. Non-GAAP EPS is now expected to land between $3.77 and $3.79 for the fiscal year. The company also provided a bullish outlook for the upcoming quarter, projecting revenue of $14.5–$14.7 billion and non-GAAP EPS of $0.96–$0.98.
Management highlighted operational discipline and strong cash flows, which have supported significant shareholder returns through dividends and buybacks. Summary Table: Q3 FY 2025 vs. Q3 FY 2024
|
Metric |
Q3 FY 2025 |
Q3 FY 2024 |
Year-over-Year Change |
|
Revenue |
$14.1 billion |
$12.7 billion |
+11% |
|
GAAP Net Income |
$2.5 billion |
$1.9 billion |
+32% |
|
GAAP EPS |
$0.62 |
$0.46 |
+35% |
|
Non-GAAP Net Income |
$3.8 billion |
$3.6 billion |
+8% |
|
Non-GAAP EPS |
$0.96 |
$0.88 |
+9% |
Leadership Transition
The company also announced that longtime CFO Scott Herren will retire at the end of July 2025. Mark Patterson, Cisco’s current chief strategy officer and a 25-year company veteran, will step into the CFO role, ensuring continuity in financial leadership.
Market Reaction and Strategic Takeaways
Investors responded positively to the earnings beat and raised guidance, with Cisco shares rising over 2% in after-hours trading. The results underscore Cisco’s successful pivot to high-growth areas like AI and security, positioning the company as a key beneficiary of enterprise digital transformation trends.
For financial analysts and investors, Cisco’s performance highlights the importance of monitoring AI and cybersecurity developments in the tech sector. The company’s ability to execute on innovation and operational efficiency makes it a standout in today’s competitive landscape.
In summary Cisco’s Q3 FY 2025 earnings report paints a picture of a company firing on all cylinders-outperforming expectations, capitalizing on AI and security demand, and setting the stage for continued growth in the quarters ahead.
