Cisco Systems Shares Slide 12% on FY26 Gross Margin Cut to 67.1%
Cisco Systems shares dropped over 12% after quarterly earnings despite beating profit and revenue estimates. Investors fret gross margins now guided to 67.1% for FY26, down from previous 68.0%, due to higher memory input costs.
1. Stock Reaction to Quarterly Beat
Cisco Systems topped quarterly profit and revenue expectations, but shares tumbled more than 12% in the session following the report as investors focused on margin concerns.
2. Lowered Gross Margin Outlook
Management now projects FY26 gross margins of 67.1%, down from the prior 68.0% estimate, citing higher memory input costs that will pressure margins over the next several quarters.
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