Cisco and Applied Materials reported sharp sales gains Thursday from different parts of the AI supply chain. Cisco raised its forecast for sales to the large cloud companies that build and connect data centers. Applied Materials reported that sales in its chipmaking equipment division rose by nearly two-thirds from a year earlier. The reports give readers two ways to see where infrastructure spending is reaching suppliers, from factory equipment to the networks that link servers.

Cisco raised its forecast for sales to cloud companies

Cisco’s quarterly release put revenue at $18.5 billion for the three months ended Oct. 24, up 24% from a year earlier. Its networking product category grew 43%. That category includes sales beyond AI infrastructure, and Cisco’s total also includes security, collaboration and services.

The company now expects $9 billion in AI infrastructure revenue from large cloud customers in fiscal 2027, more than double what it recorded in fiscal 2026. Cisco also lifted its companywide annual revenue forecast to $74.8 billion to $75.8 billion, from $72.2 billion to $73.4 billion in August. The midpoint rose by $2.5 billion. At the new midpoint, the $9 billion AI infrastructure estimate would account for about 12% of Cisco’s annual sales.

Applied Materials sold more chipmaking equipment

Applied Materials headquarters in Santa Clara, California
Applied Materials’ Santa Clara headquarters, photographed in 2023.Olaf2 / Wikimedia Commons, CC BY-SA 4.0.

Applied Materials reported $10.41 billion in quarterly revenue for the period ended Oct. 25, up 53% from a year earlier. Its Semiconductor Systems unit accounted for nearly $8 billion, up from $4.88 billion in the same quarter last year. The unit sells equipment for making chips for a range of uses, so its revenue includes purchases beyond tools for AI chips. The company expects $10.6 billion to $11.6 billion in total sales in the next quarter.

The numbers measure different purchases

Cisco sells equipment that lets servers move data across a network. Applied Materials sells equipment manufacturers use to make chips before those chips ever reach a server. A cloud operator can buy networking gear as it adds computing capacity. A chipmaker can buy tools earlier, as it prepares factory capacity for future orders. The same buildout can support purchases at both stages.

The companies also gave readers figures on different timelines. Cisco’s $9 billion is a forecast for sales to a defined set of customers over its full fiscal year. Applied’s nearly $8 billion is revenue already booked by one unit in one quarter. The comparison shows sales growth at two points in the supply chain. The releases give neither a combined measure of U.S. spending nor an estimate of how many data centers will open.