(Reuters) – Cisco Systems raised its annual revenue forecast on Wednesday, betting on higher demand for its cloud networking gear amid a boom in the artificial intelligence technology, sending its shares up 6.7% in extended trading.
Corporate customers have been investing billions of dollars in building AI infrastructure to speed up their digital transformation, boosting demand for data centers, which use Cisco’s products such as ethernet switches and routers.
The company has also seen strong order growth across its networking products as customers worked down inventory.
The San Jose, California-based company expects its revenue to be between $56 billion and $56.5 billion for fiscal 2025, compared with its prior forecast of $55.3 billion to $56.3 billion. Analysts, on average, expect $55.99 billion, according to data compiled by LSEG.
Revenue for the second quarter ended January 25 was $14 billion, ahead of analysts’ estimate of $13.87 billion.
(Reporting by Juby Babu in Mexico City; Editing by Shilpi Majumdar)
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