Live: Cisco Systems (CSCO) 1st Quarter Earnings Coverage

• New DoorDash partnership adds national reach and potentially expands order volume capacity.
• Acquired Vayu (AI autonomy) and Phantom Auto (teleoperation) to strengthen platform efficiency.
• Launched Chicago market, now active in five major metros.
• Raised $100 M via direct offering post-quarter, bringing liquidity to $310 M total.
• Loss widened due to heavy R&D (+47% QoQ) and integration expenses.

Serve delivered another quarter of rapid operational progress but fell short on profit trajectory. The market’s muted reaction suggests investors expected steep losses during this build-out phase. With liquidity strengthened and partnerships multiplying, Serve’s narrative remains about execution to scale, whether its growing fleet can convert technological leadership into a sustainable, cash-generating delivery network in 2026.

These KPIs validate Serve’s ability to scale commercially and improve per-robot productivity — the central metric for proving its autonomy model.

Management reaffirmed its 2025 outlook for over $2.5 million in revenue, implying another step-up in Q4, and reiterated expectations for “~10x revenue growth in 2026.” Serve expects to deploy its 2,000th robot ahead of schedule by mid-December 2025.
Guidance Summary:

Cisco’s Q1 sets a confident tone for FY2026. The combination of accelerating AI demand, refreshed enterprise hardware, and growing recurring revenue visibility points to a solid multiyear upcycle.

What Changed This Quarter

• AI orders accelerated beyond Q4 pace, validating Cisco’s positioning in the data center buildout cycle.

• Guidance raised on stronger backlog and early FY momentum.

• Splunk integration synergy ramping faster than expected with 400+ joint customers.

• Margins improved despite tariff uncertainty.

• Enterprise refresh cycle beginning to contribute meaningfully to product revenue.

“Our AI infrastructure strategy is delivering — with hyperscaler orders more than tripling year over year and sovereign AI projects starting to convert into shipments,” said CEO Chuck Robbins.
“We’re executing well on our transformation, and the early success of our Secure AI Factory and Splunk integration gives us confidence in durable growth ahead.”

Robbins’ comments underscore a strategic pivot toward AI and observability, positioning Cisco to compete at the intersection of networking, data, and security analytics.

Cisco raised its FY2026 revenue outlook to $60.2–$61.0B (from $59.88B consensus) and its EPS range to $4.10–$4.20 (vs. $4.04 est.), driven by strength in AI orders and Splunk cross-sell momentum.

Cisco reported Q1 FY2026 results that topped expectations, highlighting steady progress in AI networking and a solid start to the new fiscal year.

After-hours reaction: Shares rose +3.9% as investors welcomed stronger-than-expected AI infrastructure demand and improving enterprise spending trends.

Quick take: The quarter reaffirmed Cisco’s transformation from a traditional networking vendor to an AI-era infrastructure and observability leader. AI-related orders surged again, and Splunk integration continued to deepen platform stickiness. Gross margins improved modestly despite persistent tariff headwinds, showing better cost control and product mix optimization.