Cisco Systems (CSCO) Stock Steady Near $64.50 After Record Q2 FY2026 Revenue Beat, AI Orders Surge

Cisco Systems Inc.’s stock held firm near $64.50 in late February 2026, closing at $64.48 on February 24 after a 0.78% gain, as the networking giant continued to benefit from strong demand for AI infrastructure, a solid second-quarter earnings beat, and a 3% dividend increase announced earlier in the month.

As of February 24, 2026, Cisco (NASDAQ: CSCO) traded in a session range of $63.92 to $64.85 with volume of approximately 18.4 million shares. The shares have risen about 12% year-to-date in 2026, trading near the upper end of their 52-week range from $44.50 to $65.20. Market capitalization stands around $260 billion, reflecting investor confidence in Cisco’s transition toward high-growth areas such as AI networking, security, and observability.

The recent stability follows Cisco’s second-quarter fiscal 2026 results released February 12, 2026 (for the quarter ended January 25, 2026). The company reported revenue of $14.0 billion, down 6% year-over-year but beating analyst expectations of $13.7 billion. Adjusted earnings per share reached $0.96, topping consensus estimates of $0.92. Product orders grew 11% year-over-year, driven by strong demand for AI-related networking solutions, while remaining performance obligations (RPO) increased 18% to a record $42.3 billion.

CEO Chuck Robbins highlighted the acceleration of AI infrastructure deployments as a key driver, with networking orders up significantly due to hyperscaler and enterprise investments in AI data centers. Security revenue grew 8%, and observability products continued gaining traction. The company noted improved supply chain dynamics and a shift toward software and subscription models, which contributed to gross margin expansion to 68.4% on an adjusted basis.

On February 12, Cisco announced a 3% increase in its quarterly dividend to $0.41 per share, payable April 23, 2026, to shareholders of record April 2. The move underscores the company’s strong cash generation and commitment to shareholder returns, with a current yield around 2.5%. Cisco also repurchased $2.5 billion in stock during the quarter under its ongoing authorization.

Analysts remain predominantly bullish. Consensus among 25-30 firms rates CSCO a Moderate Buy to Buy, with average 12-month price targets around $68 to $72—implying 5-12% upside from current levels. High targets reach $80 from firms like Morgan Stanley and JPMorgan, citing AI tailwinds and margin expansion. Some caution persists around legacy product declines and competition from Arista Networks and others in high-speed switching for AI clusters.

Cisco guided for third-quarter fiscal 2026 revenue of $13.6 billion to $13.8 billion and adjusted EPS of $0.83 to $0.85, aligning with or slightly above consensus. Management emphasized continued AI networking momentum, security resilience, and progress toward its $1 billion annualized run rate target for observability products.

The company continues investing heavily in AI, including silicon advancements through its Silicon One platform and partnerships with hyperscalers for next-generation data center fabrics. Recent announcements include expanded collaboration with NVIDIA on AI infrastructure and new observability tools for generative AI workloads.

Challenges include a transitional period in traditional enterprise networking, where some customers delay upgrades amid economic uncertainty. However, Cisco’s diversified portfolio—spanning networking, security, collaboration (Webex), and observability—provides resilience. The shift toward software and recurring revenue streams supports improving margins and predictability.

The next earnings report, for third-quarter fiscal 2026, is expected in mid-May 2026. Investors will scrutinize AI order trends, security growth, margin progress, and any updates on full-year guidance or strategic initiatives.

Cisco Systems, a foundational player in global networking, has successfully pivoted toward AI-driven opportunities while maintaining strong cash flow and shareholder returns. Record RPO, dividend growth, and AI tailwinds position the company for sustained performance in 2026, even as legacy segments face headwinds. With shares trading at attractive multiples relative to historical averages and peers, Cisco remains a core holding for investors seeking exposure to AI infrastructure and enterprise technology.