EOD Wrap; Cisco (CSCO) Coherent (COHR) Cerebrus (CBRS) First takes; Neoclouds vs. Hyperscalers & how this week has shifted the landscape

Good afternoon. QQQs +75bps after an inline CPI print and stronger AI semis earnings (CRWV, NBIS, SMCI, LITE) helped lift the space as SOX finished +2.5%. Hyperscalers were weak with MSFT/AMZN/META -~2%. We think the last few days have provided a lot of things to think about in the landscape/narrative between Neoclouds, hyperscalers, and NVDA. We try to lay out the moving pieces and what we’ve learned over the last few days as clearly as we can below and what it means.

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Post-close earnings:

CSCO -5%: Looks solid with strong beat-and-raise with broad-based demand, $4B of hyperscaler AI orders and product orders +35% y/y (+25% ex-hyperscalers), supporting management’s “networking supercycle” narrative. The offset is that orders were a little below the ~40% buyside bogey and the F1Q GM guide implies some pressure from a higher mix of lower-margin AI hardware, which likely explains the negative reaction despite the big revenue raise.

FQ4 revenue $17.25B vs. $16.82B; GM 66.3% vs. 66.0%; EPS $1.22 vs. $1.17; OPM 35.9% vs. 34.7%.
FQ1 revenue guide $18.0–18.2B vs. $16.79B; EPS $1.32–1.34 vs. $1.16; GM 65–66% vs. 66.1%.
FY27 revenue $72.2–73.4B vs. $69.13B; EPS $5.05–5.11 vs. $4.84.

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COHR -5%: Solid print with upside across revenue/EPS and an even stronger FQ1 guide, while management emphasized “exceptional” AI datacenter demand, expanding capacity and the structural shift from copper to optical. Nothing fundamentally wrong here, but expectations were high following LITE’s stronger print/rally, and Industrial was softer.

FQ4 revenue $2.05B vs. $1.98B; GM 40.2% vs. 40.0%; EPS $1.74 vs. $1.62.
FQ1 guide: revenue $2.30B vs. $2.14B; GM 41.5% vs. 40.0%; EPS $1.95 vs. $1.77.

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CBRS -16%: Ok quarter as revenue and margins beat, FY guidance was raised, and Cerebras continues to add capacity to support what management says can be >3x revenue growth in 2027. However, not good enough as we didn’t get a major new customer announcement, the FY raise was modest, RPO was essentially flat q/q at $25.4B, and the stock had already rallied 20%+ in five days before this.

Q2 revenue $210M vs. $194M; core GM ~41% vs. 36.7%; core OPM -16% vs. ~-31%; EPS -$0.05 vs. -$0.17.
Q3 revenue $214–216M vs. $210–211M; core GM 38–40% vs. ~36%. FY revenue raised to $880–890M / $885M midpoint vs. $865M Street, from $860M previously.

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AI/SEMIS

Ok let’s try to grapple with what has happened over the last few days in regards to Neoclouds and hyperscalers…