Cisco closed FY2026 with record revenue of $63.3B. AI infrastructure orders from four major hyperscalers grew at triple-digit rates. This segment moved from under 2% of Cisco's revenue to ~6% in a single year.

What changed

Robbins made clear that the rebuild was deliberate:

If you go back just over six years, we had virtually no business with them inside their data centers. We had a little bit of enterprise technology that we were selling them. Through a combination of key investments and acquisitions that we made in silicon, optics, and security, we obviously rebuilt our relationships with our hyperscaler customers. We told them we'd meet them where we are by selling them silicon, software or systems or any combination of those.

In a CNBC interview, Robbins was more direct:

I said very honestly, seven or eight years ago, we had missed the first wave of this with the cloud. We were executing to make sure we didn’t miss the AI wave, and we didn’t. And so that business has been growing triple digits for a couple of years.

There are two lessons here for cloud alliance leaders.

Product flexibility was part of the alliance strategy

Cisco invested in the capabilities hyperscalers needed, adopted a platform approach and offered each customer what it needed - silicon, software, systems or a combination.

Strong cloud relationships require more than executive alignment. They require the product and operating model to change around a shared opportunity.​

Look at alliance economics beyond gross margin

Robbins explained:

If you think about the triple-digit growth that we talked about in the hyperscalers, our expenses to actually capture that growth are minimal in addition to what we spend today… This business, because of the magnitude of it and the growth rates, it allows us to take, even in some cases, a lower-margin business from a gross margin perspective that actually turns out to be highly profitable because we do not have to add incremental expenses to go gather that business.

FY2026 produced Cisco’s highest revenue, operating margin and earnings per employee in 30 years.

In Q4, non-GAAP gross margin declined 2.1% YoY. But opex as a share of revenue fell by 3.7% points, helping operating margin rise from 34.3% to 35.9%.

Lower gross margin can still create attractive economics when an alliance reduces incremental acquisition expense and opens much larger opportunities.

The right measure is contribution economics across acquisition cost, deal size, expansion and operating expense - not gross margin alone.

Cloud relationships compound slowly, then appear suddenly in the numbers.

Cisco’s $9.3B order in FY26 result carries six years of product investment, flexibility and relationship rebuilding.