Hungry Hyperscalers Boosted Cisco's AI Sales By A Cool Billion Bucks

Cisco sold twice as much AI kit as it forecast during its 2025 fiscal year and expects the market for binary brainboxes will continue to boost its bank balance in future.

The networking giant on Wednesday announced [PDF] its Q4 and full year results, pointing out that “AI Infrastructure orders taken from webscale customers exceeded $800 million, bringing the FY 2025 total to over $2 billion, more than double the original $1 billion target.”

CEO Chuck Robbins said that result “demonstrates the undeniable capability and relevance of our technology for multiple back-end use cases with some of the most technologically advanced customers.”

And it probably does. But let’s put it into perspective: Microsoft, AWS, and Google plan to spend almost $300 billion on datacenters in the next 12 months. Cisco is currently getting a tiny slice of that spend. Google just spent $14 billion on servers in a single quarter. Meanwhile, Cisco’s boasting about $2 billion of revenue from hyperscalers in a year. Nvidia, meanwhile, now sells around $5 billion of networking kit each quarter, plenty of it to hyperscalers.

Cisco’s Q4 saw $14.7 billion of revenue come through the door, an eight percent year-on-year jump. Net income jumped 31 percent to $2.8 billion. Full-year revenue landed at $56.7 billion, and that extra $1bn of AI sales contributed about a third of the $2.9 billion (five percent) annual revenue growth. Net income grew just one percentage point, to $10.5 billion.

Robbins was upbeat about Cisco’s prospects, pointing to a pair of billion-dollar deals with web scale customers who signed for a combination of networking, security, collaboration and observability products during the year. The CEO said customers have shown “strong interest” in Cisco’s Catalyst 9000 switches, which run its new custom silicon, and their curiosity has already translated into 80 sales of the Hypershield network security product.

The CEO also said he expects enterprise adoption of AI will trail hyperscale uptake, and that more organizations will modernize their networks in coming years. AI will therefore continue to boost Cisco’s core on-prem networking business, which in Q4 grew orders by double digits - for the fourth quarter in a row.

Robbins said he thinks “there’s a lot of [AI] pilots going. There’s a lot of work going on with customers who are piloting different applications in retail environments etc.”

“So, we think it will start to ramp and then we think that you’ll see AI applications ramp. And then the second half of the year, we think you’ll see agentic AI proof of concepts become more pervasive. And that’s going to require obviously network connectivity, network capacity, low latency.” Cisco plans to cash in.

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Asked if the USA’s new tariffs policy could present a future problem for Cisco, if only because customers rushed to buy kit before the import duties are added to product prices, Robbins said “I haven’t heard one instance in the last six months of a single customer who said ‘I’m going to order this now before price increases occur’.”

CFO Mark Patterson weighed in with his observation that other metrics Cisco uses to gauge customers’ intentions also suggest the threat of tariffs did not change buyer behavior.

Robbins also said spending by the US government remains robust, and Cisco believes it will increase in 2026 despite budget cuts.

The company forecast FY 2026 revenue will land between $59 billion to $60 billion, representing growth of between 4.0 percent and 5.8 percent.

Investors seem content with Cisco’s numbers, as the company’s share price dipped by around one percent in after hours trading. ®