Cisco Systems Inc. (CSCO) reported its fiscal second-quarter results Wednesday after the bell, and the numbers looked pretty good. Revenue came in at $15.35 billion, beating the $15.12 billion analysts were expecting. Adjusted earnings hit $1.04 per share, edging past the $1.02 consensus estimate.

Strong Growth in Networking Drives Results

The headline number tells a solid story: total revenue climbed 10% year-over-year. Product revenue jumped 14% while services revenue slipped 1%. The real star was the Networking segment, which surged 21% year-over-year. Collaboration products added another 6% growth. Not everything sparkled though—Security product revenue declined 4% and Observability stayed flat.

Cash flow from operations came in at $1.8 billion for the quarter, down 19% from last year. The company closed the quarter sitting on $15.8 billion in cash, cash equivalents and investments, which gives them plenty of dry powder.

"Cisco's strong second quarter and first half of fiscal 2026 demonstrate both the power of our portfolio and the fundamental role we continue to play in connecting and protecting customers in a rapidly evolving landscape," said Chuck Robbins, chair and CEO of Cisco.

He continued: "With over 40 years of customer trust, global scale, and a relentless focus on innovation, we believe Cisco is uniquely positioned to deliver the trusted infrastructure needed to securely and confidently power the AI-era."

Guidance Gets an Upgrade

Here's where things get interesting. Cisco expects third-quarter revenue between $15.4 billion and $15.6 billion, comfortably above the $15.18 billion analyst consensus. Adjusted earnings for Q3 should land between $1.02 and $1.04 per share versus estimates of $1.03.

More importantly, the company bumped up its full-year fiscal 2026 outlook. Revenue guidance now sits at $61.20 billion to $61.7 billion, up from the previous range of $60.20 billion to $61 billion. The full-year adjusted earnings outlook also got a lift to $4.13-$4.17 per share from the prior $4.08-$4.14 range. For context, analysts were looking for full-year revenue of $60.74 billion and earnings of $4.12 per share.

Cisco executives planned to discuss the results in more detail during an earnings call scheduled for 4:30 p.m. ET Wednesday.

Market Reaction: Down After Hours

Despite the beat-and-raise quarter, CSCO shares slipped 4.35% in after-hours trading to $81.82 at the time of publication Wednesday. Sometimes the market wants perfection, and sometimes it just wants more than you've got to give.