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- Cisco Systems reported a strong end to FY24 with sequential growth in networking equipment sales as customer inventory digestion occurs.
- Management laid out the groundwork for the next generation of Cisco as the firm undergoes a major restructuring to enhance their AI networking capabilities.
- Despite a dimming macroeconomic environment, Cisco is well-positioned for growth as enterprises invest in faster bandwidth capabilities for AI/ML testing and inferencing.
Cisco Systems, Inc. (NASDAQ:CSCO) reported a strong end to fiscal year 2024 as the firm is beginning to realize sequential growth in their networking equipment sales paired with strength in cybersecurity. On the Q4’24 earnings call, management laid out the groundwork for the next generation of Cisco as the firm restructures for the future of networking. Despite the dimming macroeconomic environment, Cisco should be well-positioned as enterprises and hyperscalers invest in faster bandwidth capabilities to support AI/ML testing and inferencing. I recommend CSCO shares with a BUY rating with a price target of $54/share at 9.61x EV/aEBITDA.
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