Cisco Systems has joined the ranks of other technology vendors reporting no negative effects from economic uncertainty and global tariff issues in their recent quarterly earnings. The networking giant saw continued customer investment in artificial intelligence (AI) and maintained its revenue forecast for the current fiscal quarter.
Key Highlights
Cisco CEO Chuck Robbins stated during the fiscal 2025 third quarter earnings call that customers are committed to their AI technology transition. “They’re going to continue to spend [on AI] until they just absolutely have to stop,” Robbins said. CFO Scott Herren noted that channel partners reported no customers delaying projects due to tariff concerns.
Financial Performance
Cisco reported:
- $14.1 billion in revenue for Q3, up 11% year-over-year
- Net income of $2.5 billion using GAAP
- Product revenue grew 15% year-over-year to $10.4 billion
- Security products portfolio sales grew 54% year-over-year to $2 billion
- Total annual recurring revenue (ARR) was $30.6 billion, up 5% year-over-year
AI and Networking Investments
The company saw significant growth in AI-related infrastructure orders, with webscale customers ordering over $600 million in AI infrastructure during the quarter. This led Cisco to surpass its $1 billion target a quarter early. Robbins emphasized that customers are investing in modern networks to achieve real-time benefits from AI agents.
Future Outlook
Cisco maintains a positive outlook on continued AI spending beyond 2025. “I don’t anticipate that 2025 is going to be a peak year… This has many years to run,” Robbins said. The company expects revenue between $14.5 billion and $14.7 billion for Q4 FY2025 and forecasts FY2025 revenue of $56.5 billion to $56.7 billion.
Strategic Positioning
Cisco is well-positioned to benefit from potential increased infrastructure and manufacturing investment in the U.S. due to global tariffs. The company’s industrial internet of things (IOT) portfolio saw 35% year-over-year order growth. Robbins noted that Cisco’s silicon investments, including the Cisco Silicon One G200 processor, are a key differentiator in the AI infrastructure market.
