Cisco posts record $63.3B revenue as AI demand surges

Cisco Systems ↗ 0.54% posted record revenue of $63.3 billion for its fiscal year ended July 25, 2026, a 12% increase from $56.7 billion in the prior year, according to the company's annual 10-K filing submitted to the SEC on September 2. Net income rose 30% to $13.3 billion, while diluted earnings per share climbed to $3.33 from $2.55 a year earlier.stocktitan+2

"We delivered a very strong close to fiscal 2026, marking another record year for Cisco. Our record performance is a testament to the accelerated pace of innovation and the excellent execution by our teams," said Chuck Robbins, Chair and CEO of Cisco.investor.cisco+1

AI Demand Drives Growth — and Inventory Risk

Product revenue surged 16% to $48.3 billion, powered by a 28% jump in the Networking category as demand for AI infrastructure and data center switching accelerated. AI infrastructure represented roughly 6% of total revenue in fiscal 2026, up from less than 2% in fiscal 2025. During the year, Cisco raised its AI infrastructure order guidance from $5 billion to $9 billion after surpassing earlier targets.earningslens+2

That AI-fueled demand, however, comes with a notable buildup in supply commitments. Inventories grew 80% to $5.7 billion, while inventory purchase commitments more than doubled to $17.2 billion, largely tied to Cisco Silicon One chips and memory components for hyperscaler customers. The filing flagged the risk of excess and obsolete inventory should demand or forecasts shift.stocktitan

Cash Returns and Forward Outlook

Cisco generated $14.2 billion in operating cash flow and $12.8 billion in free cash flow during the fiscal year. The company returned $12.7 billion to shareholders through $6.6 billion in dividends and $6.1 billion in share repurchases, with $8.1 billion remaining under its buyback authorization. A quarterly dividend of $0.42 per share is scheduled for payment on October 21, 2026.stocktitan

Short-term debt nearly doubled to $10.2 billion from $5.2 billion, including $6.7 billion in commercial paper, while remaining performance obligations — a measure of contracted future business — reached $46.7 billion, up 7% year over year. Fourth-quarter revenue alone hit a record $17.3 billion, an 18% increase, with GAAP earnings of $0.97 per share.prnewswire+2