Networking giant Cisco (CSCO) is scheduled to announce results for the third quarter of Fiscal 2026 on Wednesday, May 13. CSCO stock has risen 25% so far this year, driven by demand for the company’s artificial intelligence (AI) infrastructure from hyperscalers. According to TipRanks’ Options Tool, options traders expect about an 8.71% move in either direction in CSCO stock in reaction to Q3 FY26 earnings. This implied move is higher than CSCO stock’s average post-earnings move (in absolute terms) of 5.71% over the past four quarters.
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New trading tool for NVDA bearsMeanwhile, Wall Street expects Cisco to report an 8.3% year-over-year growth in its Q3 FY26 earnings per share (EPS) to $1.04. Revenue is expected to rise about 10% to $15.54 billion. Investors will look forward to management’s commentary on the momentum in AI infrastructure orders.
Analysts’ Views Ahead of Cisco’s Q3 Earnings
Ahead of Q3 FY26 earnings, UBS analyst David Vogt reiterated a Buy rating on Cisco stock with a price target of $95. The 4-star analyst expects strong investments in data center switching, ZR/ZR+ optical products, and campus demand to help revenue reach the higher end of the guidance range ($15.4 billion to $15.6 billion), above his estimate of $15.5 billion. For AI hyperscaler orders, a key performance indicator (KPI), Vogt conservatively projects $1 billion for Q3 FY26, following $2.1 billion in AI orders in the fiscal second quarter, bringing year-to-date orders to $4.4 billion compared to the full-year outlook of “in excess” of $5 billion.
That said, Vogt noted that investors are expecting hyperscaler AI orders of at least $1.5 billion, given upward capex revisions at Meta Platforms (META) and other hyperscalers. Meanwhile, the analyst expects higher component costs to weigh on Cisco’s gross margin despite a series of price hikes over three to six months that he estimates have increased average selling prices (ASPs) by low double digits. Specifically, Vogt expects Cisco to report a gross margin of about 66%, yielding EPS of $1.04, above his $1.03 estimate.
Meanwhile, Evercore analyst Amit Daryanani recently increased his price target for Cisco stock to $110 from $100 and reiterated a Buy rating. The 5-star analyst believes that investors are underappreciating the company’s ability to sustain double-digit growth and consistently expand EBIT (earnings before interest and taxes) margins. Daryanani believes that a major catalyst for Cisco will be its AI-centric revenues, which he expects to accelerate from about $3 billion in FY26 to $12 billion to $15 billion in about 3-4 years. The analyst expects Cisco’s Silicon One portfolio to provide a “credible path” for revenue acceleration and margin expansion.
Furthermore, Daryanani expects internet hyperscale capital spending to increase to more than $900 billion by calendar year 2027, with spending increasingly moving toward back-end networking and expanding across architectures where Cisco is now more competitive as customers seek supply diversification and network optimization.
AI Analyst Is Bullish on Cisco Stock
Interestingly, TipRanks’ AI Analyst has an Outperform rating on Cisco stock with a price target of $108, indicating about 12% upside potential. The AI Analyst’s rating reflects solid underlying financial quality, including durable margins and robust free cash flow, and favorable insights from the earnings call with strong FY26 guidance and AI/networking momentum. Technicals are supportive but overbought. Also, valuation significantly tempers the overall rating.
Is Cisco Stock a Buy, Sell, or Hold?
Heading into Q3 FY26 earnings, Wall Street has a Moderate Buy consensus rating on Cisco Systems stock based on 10 Buys and four Holds. The average CSCO stock price target of $92.92 indicates about 4% downside risk.
