CSCO · News · 20261106N

Gross Margin Drivers

CISCO SYSTEMS, INC. · 2026-11-06 · Importance 10 · Surprise 6

Morgan Stanley reportedly cited the possibility that accelerated AI-infrastructure growth could produce a less profitable product mix at Cisco. A separate report described concerns about gross-margin pressure associated with Cisco’s expanding AI hardware mix. The digest provided no quantified margin impact or margin results.

Key facts

• Morgan Stanley downgraded Cisco from Overweight to Equal Weight, citing concern that accelerated AI-infrastructure growth could lead to a less profitable product mix. source