Cisco Systems (CSCO) may have once lagged behind rivals like Arista Networks (ANET) in cloud networking, but the legacy tech giant is now making an aggressive push into enterprise AI.
Best known as the world’s largest seller of networking hardware, Cisco is now expanding its enterprise offerings for the hyperscalers that run AI-ready data centers.
Its flagship platforms — Cisco AI Defense and Cisco Hypershield — provide runtime protection and validation for AI workflows, helping enterprises deploy their own full-stack AI factories with greater security and speed.
This month, Cisco announced that both platforms are now featured in the NVIDIA Enterprise AI Factory, NVIDIA’s turnkey design for building and scaling on-prem AI systems.
Jeetu Patel, Cisco’s president and chief product officer, said the market is moving rapidly beyond chatbots to “the agentic era of AI,” where billions of autonomous agents execute complex tasks.
“As billions of AI agents begin working on our behalf, the demand for high-bandwidth, low-latency, and power-efficient networking for data centers will soar,” Patel said.
“Cisco is at the forefront, delivering secure networking technology that’s foundational to the AI-ready data centers of the future.”
$1B and counting
Cisco said in its Q3 FY25 earnings that AI infrastructure orders topped $600 million for the quarter, pushing total AI-related bookings for the year past $1 billion.
Most of that demand has come from Ethernet and fiber-optic networking gear used in hyperscale data centers.
Morgan Stanley analyst Meta Marshall noted that “while Cisco has not gotten much credit for their AI story, [they’re] starting to see meaningful traction with webscalers around AI.”
Barclays analyst Tim Long added that enterprise demand is intensifying as companies face “pressure to modernize driven by fear of falling behind competitors and determination to capitalize on the AI boom.”
He also highlighted that “demand for Cisco silicon is strong” and the company is scaling up supply to meet it.
Dabbling in quantum internet
Cisco isn’t just targeting AI. The company is also stepping into quantum computing infrastructure.
Earlier this week, Cisco Investments joined a $10 million Series A funding round for Qunnect, a startup building room-temperature quantum networking tech designed for scalable, real-world use.
The move aligns with Cisco’s long-term vision for the quantum internet. It recently launched Cisco Quantum Labs and debuted a quantum entanglement chip prototype.
“Qunnect’s approach fits right into our broader quantum networking strategy,” said Vijoy Pandey, GM and SVP of Outshift by Cisco, the company’s internal innovation arm.
“We’re not just building one-off research prototypes — we’re creating the infrastructure for a real quantum internet.”
Cisco stock is up 15.6% year-to-date and has climbed 44.5% over the past 12 months.
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