AI Is Supplying Blowout Earnings…Again

Motley Fool Hidden Gems Investing

The Motley Fool

Business, Investing

4.3 • 3.1K Ratings

🗓️ 14 May 2026

⏱️ 28 minutes

🔗️ Recording | iTunes | RSS

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Summary

If you’re making a list of the companies delivering better-than-expected earnings results this quarter, then add Cisco and Lumentum to the list. Spending on data centers and other AI infrastructure is leading both companies to soaring heights, and their valuations reflect Wall Street’s Optimism. Tyler, Matt, and Jon break down the most recent earnings results from these two AI equipment suppliers and whether they look like solid investments today. Tyler Crowe, Matt Frankel, and Jon Quast discuss: - Cisco’s blowout earnings - What to do when a cyclical company has a new catalyst - Lumentem’s even more impressive earnings - Can a company with such a high valuation be worth it? - Mailbag: What are some non-AI stock ideas for portfolio diversification. Companies discussed: CSCO, NVDA, META, LITE, ANET, CWST, DECK, TREX, BRK.B, DIS Host: Tyler Crowe Guests: Matt Frankel, Jon Quast Engineer: Dan Boyd Disclosure: Advertisements are sponsored content and provided for informational purposes only. The Motley Fool and its affiliates (collectively, “TMF”) do not endorse, recommend, or verify the accuracy or completeness of the statements made within advertisements. TMF is not involved in the offer, sale, or solicitation of any securities advertised herein and makes no representations regarding the suitability, or risks associated with any investment opportunity presented. Investors should conduct their own due diligence and consult with legal, tax, and financial advisors before making any investment decisions. TMF assumes no responsibility for any losses or damages arising from this advertisement. We’re committed to transparency: All personal opinions in advertisements from Fools are their own. The product advertised in this episode was loaned to TMF and was returned after a test period or the product advertised in this episode was purchased by TMF. Advertiser has paid for the sponsorship of this episode. Learn more about your ad choices. Visit ⁠⁠⁠⁠⁠⁠⁠⁠megaphone.fm/adchoices⁠⁠ Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	We're talking earnings and investor questions on Motley Fool Hidden Gems Investing.
0:09.7	Welcome to Motley Fool Hidden Gems Investing. I'm your host, Tyler Crow, and today I'm joined by
0:14.1	longtime contributors, Matt Frankel and John Quast. So today we're getting lots of questions from
0:20.6	members, and we thought this would be a really
0:22.3	good time to combine some listener questions as well as earnings reports that we've seen coming out
0:28.3	in the past couple days is a little bit of a marriage of good ideas. And so we're going to talk about
0:32.8	Cisco's earnings. We're going to talk about Lumentum's earnings. And also we'll get into, hey, maybe we should
0:38.1	talk about non-AI things for a little bit from our investor mailback. But as I said, we're going
0:44.1	to start with Cisco. And we got a question a little while ago from one of our listeners, I hope I
0:50.1	get the name right, Ahalish Shankar, and was asking about Cisco and what are our thoughts on it.
0:55.9	And I thought it would be a great time to start the conversation today because Cisco reported
1:00.2	earnings and the stock is up 13.8% as we were recording because numbers were pretty good.
1:09.7	Revenue growth was up about 12% for the year.
1:12.7	Earnings was up, and obviously, guidance was looking pretty good.
1:15.9	John, why don't you run us through the numbers and what you guys saw in this particular earnings that I would say defied expectations of what Cisco has been for a while?
1:25.1	Yeah, it's so surprising to be talking about Cisco, one of the poster children of the dot-com bubble over 20 years ago,
1:32.9	but really the business is booming unlike ever before.
1:36.6	You look at the most recent quarter, 12% top-line growth.
1:40.6	Really, all of the growth is coming from one part of the business.
1:44.0	Cisco has various components, but there's one part of the business that's driving everything,
1:49.0	and that is networking.
1:51.0	So the company reported 25% year-over-year growth in the networking side of the business.
	...

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