Cisco shares drop more than 2% after strong earnings met with ongoing selling pressure

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Cisco drops 2.05% today on selling

Highlights

Cisco delivered fiscal fourth quarter revenue of $17.25 billion and earnings per share of $1.22, both surpassing analyst forecasts.
Full year revenue reached a record $63.3 billion, with $3.2 billion returned to shareholders and a fifteenth consecutive dividend increase.
Shares of Cisco trade below short- and medium-term averages with sellers in control, and are expected to remain rangebound in the $104.68 to $117.62 range over the next 5 days.

AI adoption and dividends outpace forecasts as selling persists

Cisco reported strong financial results for the fiscal fourth quarter of 2026, with revenue of $17.25 billion exceeding analyst expectations and earnings per share of $1.22 also surpassing forecasts. The company returned $3.2 billion to shareholders through dividends and share repurchases, and management highlighted accelerating AI adoption and increased enterprise investment in high-performance networking as growth drivers. For the full fiscal year, record revenue of about $63.3 billion was delivered and Cisco raised its dividend for the fifteenth consecutive year, though price action has remained under broader selling pressure.

Anton Kharitonov, expert at Traders Union, sees Cisco’s drop as evidence of market concern over narrowing margins and cost pressures despite record revenue. He notes the price falling below key short- and medium-term moving averages, with mixed momentum signals and sellers dominating intraday trading. While long-term structure holds, weakening sentiment and oversold signals highlight significant risk. Kharitonov points out that only a clear reversal in technicals or fundamental improvements can shift sentiment. "Unless Cisco decisively breaks above resistance, I see more downside and recommend caution in the short term."

Viktoras Karapetjanc, expert at Traders Union, emphasizes Cisco’s robust fundamentals and ongoing AI-driven demand. He highlights the record annual revenue, consistent dividend growth, and strong shareholder returns as underpinnings for long-term strength. Karapetjanc notes the bullish structure is still intact above the 200-day moving average, and sees further growth prospects through enterprise adoption trends. "Despite near-term volatility, Cisco’s performance and strategic positioning point to attractive setups for patient investors."

Parshwa Turakhiya, analyst, observes mixed signals in Cisco’s recent price action after earnings. The sharp drop and oversold intraday readings hint at possible short-term reversal plays, even as sellers remain in control. With volatility elevated and rangebound movement likely, Turakhiya sees opportunities for tactical trades around the $110.07–$111.77 level. "I expect nimble traders can exploit these whipsaws, but risk management is key with sentiment this shaky."

Long-term support holds as intraday pressure and mixed momentum signals clash

Cisco is trading below both the 20-day and 50-day moving averages ($116.39 and $117.72), signaling short- and medium-term pressure from sellers. The price holds above the 200-day moving average ($91.77), which supports a bullish long-term structure, with the near-term ceiling at $111.77 and near-term floor at $110.07. Momentum indicators show mixed signals. The MACD signals a possible buy setup, but the ADX at 13.25 suggests a lack of clear trend. The RSI is weak at 44.09 and forecasts a sell, while the Stochastic RSI indicates oversold conditions at zero. The CCI sits neutral at -48.41. Bull/Bear Power rests at -2.8, confirming sellers dominate intraday momentum and forecast further oversold pressure. The Awesome Oscillator is neutral. Cisco slipped $2.33 or 2.05% today after opening with a downside gap of about $1.90 (1.67%), currently trading mid-range with intraday volatility at 1.55%. Price action reflects continued pressure after the open, with momentum signals in conflict as intraday selling dominates despite some oversold signals.

Earlier, analysts noted that Cisco's technical outlook favored range-bound trading with potential breakout risk amid mixed momentum signals. Current conditions reinforce this view, with sellers maintaining pressure and momentum indicators divided, making the prevailing scenario a continuation of rangebound trading between $104.68 and $117.62 over the coming week.

Source of Data: CSCO Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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