Cisco Reports Record Q1 Revenue, Raises FY2027 Sales Guidance

Cisco Systems Inc. (NASDAQ: CSCO ) reported record first-quarter revenue of $18.52 billion, up 24% year-over-year, even as its headcount fell, and said it has given every employee an AI agent. The networking giant is also bringing Anthropic ’s Claude Mythos model into its security products. Growth With a Smaller Workforce and AI Agents Cisco’s headcount has fallen by a low single-digit percentage, CFO Mark Patterson said on the company’s first-quarter earnings call.

He said the smaller workforce is "driving an expected revenue per employee increase of approximately 19% based on our updated FY ‘27 guidance.” CEO Chuck Robbins said the updated outlook implies "$19 billion in incremental revenue" over two years. "We’re going to do that with less headcount than we had at the beginning, 2 years ago," Robbins added. Meanwhile, Cisco is also leaning on AI inside the company.

Robbins cited the team’s "commitment to leveraging AI tools" and said that "At the start of fiscal ‘27, we provided an AI agent for every employee.” Robbins added that the company expects to “continue accelerating AI adoption, helping our employees execute.” The executives did not link the agents to the headcount change. Patterson credited "financial discipline" for helping lift operating margin from 34.8% in fiscal 2026 to an expected 36% in fiscal 2027.

Read Also: Trump Urged Jensen Huang To ‘Keep Fighting’ for His Nvidia CEO Job Two Days Before Resignation: Report Claude Mythos Enters Cisco’s Security Business Cisco is also bringing AI into its security products and announced a security tie-up with Anthropic earlier this week. Robbins said Cisco is “integrating Anthropic’s Claude Mythos cybersecurity model into Cisco AI Defense for adaptive AI red teaming." He added that it provides “automated, continuous testing across enterprise systems.” Robbins also pointed to a “post Mythos opportunity” for network upgrades.

“We’re beginning to hear customers that are attributing orders to early Mythos implications,” he said, citing European service providers that need to upgrade equipment for their customers. However, Robbins gave no figures for those orders. The networking equipment company reported adjusted earnings of $1.40 per share for the quarter, beating estimates of $1.33 per share. Cisco also raised its fiscal year 2027 revenue guidance to a new range of $74.8 billion to $75.8 billion from $72.2 billion to $73.4 billion, versus estimates of $73.02 billion.

Shares of Cisco closed 1.24% higher at $102.01 on Thursday, and were down 0.50% after hours, according to Pro. Year-to-date, the stock has surged about 32.43%. See More: Top Value Stocks Image via Shutterstock