Cisco set a excessive bar for itself within the new 12 months after a prolific 2025.
Final 12 months, Cisco refreshed its core switching and router portfolios, including new software program capabilities for the information middle in 2025. It additionally made a lot of AI networking strikes, together with the introduction of the Cisco 8223, a high-end, 51.2 Tbps router and chip designed for distributed AI workloads.
As well as, Cisco expanded its Nvidia relationship with a lot of joint choices, together with the Cisco N9100 collection information middle swap. The 64-port, 800Gb Ethernet swap is powered by Nvidia’s Spectrum-Four ASIC, which is designed for AI, high-performance computing and cloud information middle networks that require ultra-low latency, congestion management, and predictable efficiency.
Cisco additionally teamed with Nvidia and VAST Information to supply prospects a pre-integrated AI infrastructure bundle, together with compute, community, storage and information, to help AI workload information materials in addition to large-scale coaching and inference.
The demand for AI infrastructure has already begun to influence Cisco’s earnings, and the seller expects continued progress.
On the shut of its 2025 fiscal 12 months in late July, Cisco reported income of $14.7 billion for the fiscal fourth quarter, which is up 8% in comparison with the year-earlier quarter. Annual 2025 income got here in at $56.7 billion, which is up 5% from the earlier 12 months.
“Enterprise product orders had been up 5% year-over-year in This autumn [while] networking product orders grew double digits in This autumn, marking the fourth consecutive quarter of double-digit progress,” CEO Chuck Robbins stated on the time. “There may be robust curiosity from prospects within the new household of Cisco Catalyst 9000 good switches, together with a totally refreshed lineup of extremely safe routers, wi-fi entry factors, and industrial IoT units, that are purpose-built for the AI-ready campus and department.”
Count on Cisco to proceed including to and solidifying these merchandise within the coming 12 months, business watchers say, as the seller goes after what it sees as a multi-year, multi-billion-dollar refresh alternative within the enterprise networking enviornment.
It’s an Ethernet world
Efforts to increase Ethernet’s dominance are gaining traction, which may benefit Cisco.
In a be aware about 2026 information middle networking predictions, analyst Sameh Boujelbene acknowledged that scale-up is rising as a brand new battlefield for Ethernet:
“After securing a number one place within the scale-out phase of AI back-end networks, Ethernet is now increasing into scale-up, the place NVLink has traditionally dominated. On this area, Ethernet will compete not solely with NVLink but in addition with UALink, one other various to NVLink,” wrote Boujelbene, vp of the Dell’Oro Group. “We anticipate 2026 can be a 12 months stuffed with vendor bulletins focusing on each Ethernet and UALink alternatives in scale-up. Scale-up represents what may very well be the most important whole addressable market enlargement the business has ever seen.”
In 2025, Ethernet overtook InfiniBand in AI back-end networking — “a decisive turning level,” Boujelbene wrote. “This shift is especially hanging on condition that simply two years in the past, InfiniBand accounted for practically 80% of the information middle swap gross sales in AI back-end networks.”
The fast adoption of Ethernet in AI back-end deployments propelled whole Ethernet information middle swap gross sales to an all-time excessive in 2025, practically doubling annual revenues in contrast with 2022 ranges, Boujelbene acknowledged. “800 Gbps effectively surpassed 20 M port inside simply three years of shipments: As a degree of reference, it took 400 Gbps six to seven years to attain the identical milestone.”
Including to the Ethernet effort are teams such the Extremely Ethernet Consortium and the Ethernet for Scale-Up Networking, that are working to undertake Ethernet for AI and high-performance computing. Cisco is a contributor to each efforts.
“Cisco is a big incumbent, which implies that they win by default so long as they don’t mess up too badly,” stated Tom Nolle, principal analyst at Andover Intel and a Community World columnist. “Thus, they should kiss the same old networking infants, which means AI and safety. The important thing for them is to be significant in these areas so a competitor doesn’t steal prospects/market share.”
AI infrastructure momentum
Demand for AI infrastructure is rising at an exponential price, which stands to profit Cisco and its main opponents, together with Arista, HPE/Juniper, and Excessive.
Whole world information middle IT tools spend — together with servers, accelerators (XPUs), networking, optics, and storage — between 2025 and 2030 is anticipated to succeed in as a lot as $4.7 trillion {dollars}, in response to a McKinsey & Firm report cited in a weblog submit by Jake Katz, Cisco’s vp, AI product administration.
Hyperscalers are answerable for over 60% of this infrastructure funding, Katz famous. Neoclouds are answerable for about 17%, and their share is anticipated to develop to over 30% over the following ten years, Katz acknowledged.
Whereas a lot of the demand for AI information middle capability as we speak comes from hyperscalers and neocloud suppliers, that may change as enterprise prospects delve extra into the AI networking world.
“The opposite ecosystem members and enterprises themselves have gotten answerable for an growing proportion of the AI infrastructure buildout as inferencing and agentic AI, sovereign cloud, and edge AI grow to be extra mainstream,” Katz wrote.
Extra enterprises will transfer to host AI on premises by way of the introduction of AI brokers which might be designed to inject clever perception into functions and assist enhance operations. That’s the place the AI influence on enterprise community visitors will seem, suggests Nolle.
“Enterprises must host AI to create AI community influence. Simply accessing it doesn’t do a lot to visitors. Having cloud brokers entry native information middle assets (RAG and so forth.) creates a governance concern for many company information, in order that received’t go too far both,” Nolle stated.
“Enterprises are AI brokers, not the way in which hyperscalers tout agentic AI, however brokers operating on small fashions, usually open-source, and are regionally hosted. That is the place actual AI visitors will develop, and Cisco may very well be susceptible in the event that they don’t perceive this level and a minimum of increase it in dialogs the place AI internet hosting comes up,” Nolle stated. “I don’t anticipate they’d go too far, as a result of the actual marketplace for enterprise AI networking might be a pair years out.”
In the meantime, observers anticipate Cisco to proceed bolstering AI networking capabilities for enterprise department, campus and information facilities in addition to hyperscalers, together with via optical help and different gear.
Infrastructure modernization fueled by Cisco-Nvidia pairing
Know-how options supplier World Large Know-how not too long ago revealed its IT infrastructure Modernization Priorities for 2026 report, which discovered that many organizations are nonetheless reliant on outdated, legacy infrastructure that’s ill-equipped to deal with trendy workload necessities. The rise of AI has heightened the significance of IT modernization, World Large Know-how stated.
Cisco’s wide-ranging partnership with Nvidia reinforces its plans to advertise that sort of modernization.
For enterprise prospects, one of the vital fascinating elements of the Cisco-Nvidia collaboration is the tie-in between Cisco’s Silicon One-based switches and Cisco N9100 Collection Switches that incorporate Nvidia’s Spectrum-X Ethernet swap silicon and are managed from the Cisco Nexus dashboard.
“Embedding Spectrum X know-how right into a Nexus surroundings, the place prospects already doubtless have the ability units, they know the best way to handle and run that surroundings, is a superb transfer,” Neil Anderson, vp and CTO of cloud, infra, and AI options for World Large Know-how, informed Community World. “If you happen to’re a financial institution buyer for instance, you will have already certified on Nexus. Now all you must do is incorporate the Nvidia know-how — it simply accelerates the power to undertake it and help it.”
One of many causes Nvidia is partnering with Cisco is as a result of they know that this distributed phenomenon goes to occur, Anderson stated. “And so they want any person that’s received deep community expertise to increase a cluster and make it distributed.”
One other component of the Nvidia partnership that’s anticipated to affect Cisco’s 2026 efforts is the Cisco Safe AI Manufacturing unit with Nvidia, which brings collectively Cisco safety and networking know-how, Nvidia DPUs, and storage choices.
“The notion of a safe AI manufacturing unit and what they’re doing with Nvidia there may be distinctive available in the market to me, and it resonates with our shoppers. As a result of for those who’re going to run your mental property on that distributed cluster, you’ve received to have safety within the stack, and that’s what this addresses,” Anderson stated. “I’m encouraging them to maintain doubling down on that one in 2026.”
Not associated to the Nvidia partnership however solidly centered on distributed AI is Cisco’s new Unified Edge providing, in response to Anderson. The Unified Edge, introduced in November, is an built-in bundle of networking, compute and storage geared toward serving to enterprise prospects extra effectively deal with information from AI and different workloads on the edge, the place the information is often created.
In the end, prospects are transferring from centralized genAI clusters within the information middle to extremely distributed AI that lives nearer to the sting the place information is created, Anderson stated. “This bundle provides the distributed efficiency and ease we expect can be an necessary, helpful providing for purchasers.”
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