New York, Feb 16, 2026, 16:34 (ET) — Market closed.
- Cisco shares last closed higher on Friday after a volatile week tied to its quarterly outlook.
- Investors are weighing AI-driven demand against pressure on hardware profitability.
- The next U.S. session starts Tuesday, with macro and big-tech signals in focus.
Cisco Systems Inc shares will reopen for U.S. trading on Tuesday after the Presidents Day shutdown, following a 2.47% rise to $76.85 at Friday’s close. (MarketWatch)
The pause matters because Cisco is sitting in the middle of two trades that keep colliding: AI infrastructure spending that pulls in orders, and rising component costs that can squeeze profit even when sales grow. Traders have to decide which one dominates when liquidity returns.
Cisco’s quarterly update last week put the margin issue front and center. Adjusted gross margin — the slice of revenue left after the cost of the gear — came in at 67.5%, below estimates, as a jump in memory prices raised costs, Reuters reported. Jake Behan, head of capital markets at Direxion, said “compressed margins definitely took some shine off the report.” (Reuters)
Cisco told investors it still sees broad demand and guided for fiscal 2026 revenue of $61.2 billion to $61.7 billion, while lifting its quarterly dividend 2% to $0.42 a share. The company said AI infrastructure orders from hyperscalers totaled $2.1 billion in the quarter ended Jan. 24, and CFO Mark Patterson pointed to “exercising financial discipline” on costs. (Cisco Investor Relations)
The stock reaction has been jagged. Cisco fell about 12% in regular trading the day after its results even as rival Arista Networks jumped in after-hours trade on its own report, with investors drawing a straight line from margin guidance to hardware pricing power. (MarketWatch)
Cisco is also trying to keep itself in the AI conversation on products, not just forecasts. The company last week unveiled a Silicon One G300 networking chip and a router aimed at speeding traffic inside giant AI data centers, taking aim at Broadcom and Nvidia in a market Cisco pegged at $600 billion. “We focus on the total end-to-end efficiency of the network,” Cisco executive vice president Martin Lund said. (Reuters)
For the next session, the watch is simple but not easy: can Cisco keep converting AI-driven orders into revenue fast enough to blunt the cost squeeze, and can it push through price increases without slowing demand. “Hyperscalers” are the big cloud operators that buy at massive scale — the customers who can lift a quarter, or lean on pricing.
There is a downside path. Memory prices may stay elevated longer than investors expect, turning what looks like a temporary pinch into a recurring drag on gross margin. If that happens alongside slower enterprise spending, Cisco’s revenue guide can hold up while the stock still struggles on profit expectations.
The next hard catalyst for the AI complex comes Feb. 25, when Nvidia reports quarterly results — a read-through point many investors use for AI capex and data-center demand that spills into networking suppliers such as Cisco. Cisco also has a major security marketing push lined up at RSAC in San Francisco on March 23–26. (NVIDIA Investor Relations)
