Cisco Systems' quarterly revenue and profit exceeded expectations, but failed to satisfy investors' appetite raised by its strong performance in the previous quarter. The company said on Wednesday that revenue increased 18% year-on-year to $17.3 billion in the fourth fiscal quarter ending July. Earnings per share, excluding some projects, were reported at $1.22. Analysts had forecast revenue of $16.8 billion and earnings per share of $1.17. The stock closed at $123.88 in New York before falling about 5% in after-hours trading. Cisco has risen nearly 25% over the past three months as investors believe its new strategy focused on artificial intelligence will lead to stronger sales growth. Cisco, the world's largest manufacturer of network equipment, has been restructuring to secure more contracts in the global AI data center construction boom. This new strategy helped the company win more customers. But it also faces increasing competition from companies such as Broadcom and HP, and investors have high hopes that its devices will benefit from the AI craze. Fiscal fourth quarter results overshadowed Cisco's strong expectations for future revenue and profits. In its announcement, the company expects revenue for the first fiscal quarter ending October to be between $18 billion and $18.2 billion. The average estimate from analysts is $16.8 billion. Excluding some projects, earnings per share are expected to be between $1.32 and $1.34, which is also higher than the market forecast of $1.17. Industry research analyst Woo Jin Ho wrote in the report: “We expect the momentum of artificial intelligence to remain strong.”

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