Cisco's Hidden AI Order Book Skyrocketed

Cisco Systems witnessed a substantial stock increase from August 2025 to August 2026, significantly outperforming the S&P 500. This surge was foreshadowed by a rapidly growing AI order book that was publicly disclosed over three preceding quarters. By February 2025, Cisco reported over $350 million in AI infrastructure orders for fiscal Q2 2025, reaching approximately $700 million year-to-date and projecting over $1 billion for fiscal 2025. By August 13, 2025, just before the stock rally began, fiscal Q4 2025 AI orders exceeded $800 million, pushing the fiscal 2025 total past $2 billion.

Despite these escalating orders, Cisco's income statement showed little impact in fiscal 2025, with trailing-twelve-month revenue growth at only 0.5%. Management clarified that only about $1 billion of the over $2 billion in fiscal 2025 AI orders had been recognized as revenue by year-end. The true impact became evident in fiscal 2026, reported on August 12, 2026. AI infrastructure orders reached $9.3 billion for the year, and AI infrastructure for hyperscalers accounted for approximately 6% of total revenue, a notable increase from less than 2% in fiscal 2025. This period also saw full-year revenue grow by 12% to $63.3 billion, with a corresponding increase in operating margin.