Cisco occupies a split position -- its networking hardware business benefits enormously from AI data center buildouts, but its software, services, and collaboration tools face meaningful AGI disruption risk from autonomous network management and leaner IT organizations.
Cisco Systems is the world's largest networking equipment company, providing hardware, software, and services for enterprise networking, security, collaboration, and observability. The company's products form the backbone of enterprise and service provider networks globally, including routers, switches, wireless access points, firewalls, and related management software. Following its $28 billion acquisition of Splunk in 2024, Cisco significantly expanded its software and observability capabilities. Cisco has been transitioning from a hardware-centric to a software and subscription-driven business model.
Cisco serves virtually every large enterprise, government agency, and service provider globally. Its networking equipment is deployed in the vast majority of Fortune 500 company networks. Key verticals include financial services, healthcare, education, government/defense, manufacturing, and telecommunications service providers. Cisco also serves SMBs through its Meraki cloud-managed platform and partner ecosystem.
Cisco straddles hardware and software. Its networking hardware (routers, switches, access points) is physical infrastructure that AGI cannot replace and will increasingly demand. However, its software and services portfolio -- network management (DNA Center, Meraki dashboard), collaboration tools (Webex), security software (SecureX), and observability (ThousandEyes, Splunk) -- faces direct AGI disruption. AGI could potentially manage networks autonomously without needing Cisco's management software layers. Cisco's large services/consulting business for network design and implementation could also be disrupted by AGI that designs and configures networks autonomously. Cisco's customers span every industry, but enterprise IT departments are the primary buyers. If AGI reduces the need for large IT teams, purchasing decisions could consolidate and budgets could shrink. However, every organization that uses AGI needs networking infrastructure.