Cisco Systems (CSCO) Is About to Report Q3 Earnings. Here’s What to Expect

Networking giant and cybersecurity solutions provider Cisco Systems (CSCO) is scheduled to announce its results for the third quarter of Fiscal 2025 after the market closes on Wednesday, May 14. The company is expected to gain from the demand for its artificial intelligence (AI)-enhanced infrastructure solutions and cybersecurity offerings. Analysts expect Cisco to report Q3 FY25 earnings per share (EPS) of $0.92, reflecting a 4.5% year-over-year growth. Revenue is estimated to rise about 11% to $14.05 billion.

Interestingly, Cisco returned to revenue growth in Q2 FY25 after four consecutive quarters of decline, thanks to AI infrastructure orders that surpassed $350 million and contribution from the Splunk acquisition. 

Analysts’ Views Ahead of Cisco’s Q3 FY25 Earnings

Heading into Q3 FY25 results, Evercore analyst Amit Daryanani reiterated a Buy rating on Cisco stock with a price target of $67. The 5-star analyst stated that Cisco looks well-positioned to deliver upside to the Q3 FY25 estimates and likely issue revenue guidance for July quarter that is in line with the Street’s estimates. However, he expects the company to provide a better EPS outlook for the July quarter than the consensus estimate of $0.93, driven by better-than-anticipated EBIT margins.

Daryanani noted that Cisco’s networking peers have generally reported favorable results, with strength across service provider, enterprise, and cloud businesses. The analyst added that the networking market is broadly undergoing a cyclical recovery and he thinks it should support upside through FY25.

In FY26, Daryanani see tailwinds from the ongoing product refresh. He also expects Splunk to deliver good results, with both Security and Observability delivering in-line to slightly better-than-expected results. He sees slight upside to Cisco’s AI orders guidance, with a target of $1.0 billion in orders compared to $700 million run-rate exiting Q2 FY25.

Meanwhile, Rosenblatt analyst Mike Genovese lowered the price target for Cisco stock to $63 from $80 but maintained a Buy rating. The 4-star analyst noted that March quarter results will be “generally solid” for the optical sector. However, he cautioned that none of the companies are immune to the negative impact to gross margins due to higher tariffs, or from a notable macroeconomic slowdown due to elevated prices and uncertainty in business backdrop that could impact the second half of 2025.

Here’s What Options Traders Anticipate

Using TipRanks’ Options tool, we can see what options traders are expecting from the stock immediately after its earnings report. The expected earnings move is determined by calculating the at-the-money straddle of the options closest to expiration after the earnings announcement. If this sounds complicated, don’t worry, the Options tool does this for you.

Indeed, it currently says that options traders are expecting about a 5.1% move in either direction in Cisco stock in reaction to Q3 FY25 results.

Is CSCO Stock a Buy, Sell, or Hold?

Overall, Wall Street has a Strong Buy consensus rating on Cisco Systems stock based on nine Buys and three Holds. The average CSCO stock price target of $67.73 implies about 10% upside potential from current levels. CSCO stock has risen 4.2% year-to-date.

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