Cisco Systems (CSCO) Stock Forecast & Price Target

Cisco Systems demonstrates a robust financial position marked by a notable 13% year-over-year increase in total product orders and a strong revenue growth of 8% year-over-year in 4Q25, amounting to $14.67 billion. The company also reported impressive order growth in its Service Provider segment, jumping 49% year-over-year, fueled by significant contributions from top Webscale customers, indicating a strong demand for its offerings. Additionally, the continued growth in the backlog—over 60% year-over-year to $10.3 billion—along with strong demand for AI infrastructure and campus networking solutions, underscores the positive outlook for Cisco's future performance.

Cisco Systems faces a challenging transition from hardware sales to recurring software and services, which could occur more slowly than anticipated, leading to potential declines in hardware revenue. Additionally, a 6% year-over-year decline in public sector orders and ongoing supply chain issues could further impact revenue growth and negatively influence gross margins. While networking orders have shown robust growth, the overall outlook remains cautious due to competitive pressures in security revenue and the ongoing shift to cloud subscriptions.