May. 19 at 5:40 AM
$CSCO Q3 FY26 was a clean beat-and-raise. Stock surged ~14-19% to ~
$116, sharpest single-session move since 2002.
Bull case:
Record revenue
$15.84B (+12% YoY)
Adj EPS
$1.06 beat
$1.04
Q3 hyperscaler AI orders
$1.9B (vs
$600M YoY), YTD
$5.3B already past prior
$5B full-year target
FY26 AI orders target raised to
$9B (4.5x FY25), AI revenue target lifted to
$4B from
$3B
FY27 AI revenue target
$6B+
5 new hyperscaler design wins in Q3 (2 optics, 3 systems)
Acacia optics:
$1B+ orders in Q3, >200% YoY growth pace
Backlog
$43.5B (+4% YoY)
FY26 guide raised to
$62.8-
$63.0B rev /
$4.27-
$4.29 adj EPS
6 firms hiked PTs to the
$112-
$132 range vs prior
$89.54
Less supply-constrained than peers due to in-house Silicon One
Risks:
Security flat at
$2.0B (only soft spot)
6th SD-WAN zero-day of 2026 (CVE-2026-20182, CVSS 10.0) disclosed May 14
Layoff charges ~
$1B pre-tax,
$450M in Q4
Forward P/E ~27x is no longer cheap
Tariff/component cost pressure continues
$CSCO $ANET $NVDA $AVGO $MRVL
