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Analyst Upgrades Cisco Systems As It Anticipates $6 Billion in FY2027 AI Revenue

Cisco Systems, Inc. (NASDAQ:CSCO) is one of the tech stocks held by Goldman Sachs, with a total holding value of almost $2.78 billion, making it to our list of the top Goldman Sachs tech stocks to buy now.

Cisco shares are trading at their all-time high as investors show positive sentiment towards the company’s notable quarterly earnings performance. The company posted adjusted earnings per share of $1.06 for the third quarter of FY2026, surpassing the expected $1.04 per share. Revenue also exceeded expectations of $15.56 billion, coming in at $15.84 billion for the quarter. This marks a 12% revenue growth from a year ago. The company’s AI infrastructure and hyperscaler orders boosted the sales, and so far in 2026, Cisco has received AI infrastructure orders worth $5.3 billion. The company expects these orders to reach $9 billion in FY2026. In this space, the company anticipates the FY2026 revenue to reach $4 billion, up from the previous projection of $3 billion.

Ken Wolter / Shutterstock.com

Cisco’s CEO, Chuck Robbins, highlighted that the company’s robust performance during Q3 demonstrates its relevance in connecting with and securing AI technology. On May 15, HSBC lifted the rating on CSCO from Hold to Buy, also raising the price target to $137 from $77. The analyst took a bullish stance and recommended HSBC as a Buy, largely due to Cisco’s growing AI orders, which are effectively redefining the firm’s growth trajectory.

Cisco’s management anticipates around $6 billion in FY2027 AI revenue, which implies a 50% year-over-year growth. On May 26, TheFly reported that BofA increased the price target on CSCO from $114 to $135, keeping a Buy rating. BofA’s target increase follows Q3 results and the company’s promising update around Acacia Communications. Acacia is focused on designing and manufacturing an entire portfolio of high-speed optical interconnect technologies that serve different applications across datacenter, metro, regional, long-haul, and undersea networks. BofA sees Acacia’s strong demand as positive, considering the underlying demand environment for Optical Networking.

Cisco Systems, Inc. (NASDAQ:CSCO) is involved in the manufacture, design, and sale of Internet Protocol-based networking products and services associated with the communications and IT industry.

While we acknowledge the risk and potential of CSCO as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than CSCO and that has 10,000% upside potential, check out our report about this cheapest AI stock.

READ NEXT: 40 Most Popular Stocks Among Hedge Funds Heading Into 2026 and 12 Oversold Financial Stocks to Invest in According to Hedge Funds.

Disclosure: None. Follow Insider Monkey on Google News.

The $250 Trillion AI Hype is Real. A few years from now, you’ll probably wish you’d bought this stock.

Dr. Inan Dogan

Dr. Ian Dogan

Co-Founder and Research Director at Insider Monkey

When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.

Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.

At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.

Do the math. According to Musk, this technology could be worth $250 trillion by 2040.

Put another way, that’s roughly equal to:

  • 175 Teslas
  • 107 Amazons
  • 140 Metas
  • 84 Googles
  • 65 Microsofts
  • And 55 Nvidias

And here’s the wild part — this $250 trillion wave isn’t tied to one company, but to an entire ecosystem of AI innovators set to reshape the global economy.

It’s a leap so massive, it could reshape how businesses, governments, and consumers operate worldwide.

Even if that $250 trillion figure sounds ambitious, major firms like PwC and McKinsey still see AI unlocking multi-trillion-dollar potential.

How could anything be worth that much?

The answer lies in a breakthrough so powerful it’s redefining how humanity works, learns, and creates.

And this breakthrough has already set off a frenzy among hedge funds and Wall Street’s top investors.

What most investors don’t realize is that one under-owned company holds the key to this $250 trillion revolution.

In fact, Verge argues this company’s supercheap AI technology should concern rivals.

Before I reveal the details, let’s talk about how some of the richest people on the planet are positioning themselves.

  • Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
  • Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
  • Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.

When billionaires from Silicon Valley to Wall Street line up behind the same idea — you know it’s worth paying attention to.

Even as we admire what Tesla, Nvidia, Alphabet, and Microsoft have built, we believe an even greater opportunity lies elsewhere…

But the real story isn’t Nvidia — it’s a much smaller company quietly improving the critical technology that makes this entire revolution possible.

And judging by what I’m hearing from both Silicon Valley insiders and Wall Street veterans…

This prediction might not be bold at all:

A few years from now, you’ll wish you’d owned this stock.

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Wall Street calls this $3 stock a “Melting Ice Cube.” They said the same thing about BTI before it returned 90%.

Dr. Inan Dogan

Dr. Ian Dogan

Co-Founder and Research Director at Insider Monkey

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We alerted our subscribers, and BTI returned 90% in just 16 months.

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Today, we have identified a nearly identical pattern in a digital-first giant trading at $3.

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