Cisco has raised its forecast for the 2024/25 fiscal year following a strong third quarter due to sustained high demand, particularly as a result of the AI boom. The networking equipment provider now expects revenue growth of up to five percent to approximately $56.7 billion (around €50.8 billion), which exceeds earlier expectations of $56 to $56.5 billion.
Strong Quarterly Results
In the third quarter, revenue increased by eleven percent compared to the previous year, reaching $14.1 billion. Profit surged by nearly a third to around $2.5 billion, significantly surpassing expectations. Cisco also recorded infrastructure orders to support artificial intelligence amounting to approximately $600 million in the last business quarter, achieving the billion-dollar mark in this area a quarter earlier than planned.
Drivers of Growth
This positive development is primarily driven by strong demand for products triggered by the boom in artificial intelligence. The raised forecast also signals a more optimistic assessment of profit despite challenges like U.S. customs policy. In response, Cisco’s stock rose about four percent in after-hours trading.
In summary, Cisco’s continued revenue growth is closely linked to the AI boom and makes the company particularly attractive to investors due to improved earnings prospects and a strong market position in network technology and AI infrastructure.