Cisco Systems, Inc. designs, manufactures, and sells Internet Protocol based networking and other products related to the communications and information technology industry in the Americas, Europe, the Middle East, Africa, the Asia Pacific, Japan, and China. The company also offers switching portfolio encompasses campus switching as well as data center switching; enterprise routing portfolio interconnects public and private wireline and mobile networks, delivering highly secure, and reliable connectivity to campus, data center and branch networks; wireless products include wireless access points and controllers; and compute portfolio including the cisco unified computing system, hyperflex, and software management capabilities, which combine computing, networking, and storage infrastructure management and virtualization. In addition, it provides Internet for the future product consists of routed optical networking, 5G, silicon, and optics solutions; collaboration products, such as meetings, collaboration devices, calling, contact center, and communication platform as a service; end-to-end security product consists of network security, cloud security, security endpoints, unified threat management, and zero trust; and optimized application experiences products including full stack observability and network assurance. Further, the company offers a range of service and support options for its customers, including technical support and advanced services and advisory services. It serves businesses of various sizes, public institutions, governments, and service providers. The company sells its products and services directly, as well as through systems integrators, service providers, other resellers, and distributors. Cisco Systems, Inc. has strategic alliances with other companies. Cisco Systems, Inc. was incorporated in 1984 and is headquartered in San Jose, California.

Cisco appears to be a mature, profitable business with strong margins, but the market is already pricing in very generous expectations. Revenue, gross profit, EBITDA, operating profit, and net profit are all growing year over year, which confirms the resilience of the operating model and the improvement in earnings quality. The margins are also strong: net margin, operating margin, ROE, ROA, and ROI are noticeably above the industry median and continue to improve, so fundamentally the company does not look weak. At the same time, valuation on P/S, P/B, and P/FCF is significantly above industry benchmarks, while P/E, although below the median, does not make the stock cheap in the context of the other multiples. The rise in P/S, P/B, and P/FCF over recent periods is particularly concerning: the price is outpacing fundamental cash flows and the balance-sheet base. Liquidity remains a weak spot: the quick ratio and current ratio are below the industry median, which is not critical for such a large issuer, but does call for caution. Debt burden is moderate and is decreasing in terms of absolute long-term debt, which supports the investment profile and reduces financial risk. Dividend yield has declined noticeably compared with last year, so the dividend argument is weaker than before. Growth in net worth, equity, and assets confirms the company’s scale and financial stability, but on its own it does not offset the high market multiples. Overall, Cisco’s fundamentals are solid, but overvaluation in terms of multiples and the cooling of dividend attractiveness limit upside potential. For an investor, this is more of a high-quality defensive story with sustainable earnings than a clear undervaluation. Therefore, the target forecast should be slightly reduced while maintaining a moderately positive view of the company.

Cisco Systems, Inc.

Сильный индекс, значительно упал. Быки в растерянности.

Strong index, significantly down. The bulls are confused.

Средний индекс, значительно упал. Медведи продолжают терять уверенность.

Medium index, significantly down. Bears continue to lose confidence.

Слабый индекс, значительно упал. Рынок на стороне быков.

Weak index, significantly down. The market is on the bulls' side.

Слабый индекс, значительно вырос. Рынок не поддерживает медведей.

Weak index, significantly up. The market does not support the bears.

Средний индекс, незначительно упал. Приток средств в лонги снизился, но остается положительным.

Medium index, slightly down. The inflow of funds into longs has decreased, but remains positive.

Слабый индекс, незначительно вырос. Отток средств из шортов остается значительным.

Weak index, slightly up. The outflow of funds from shorts remains significant.

Cisco’s strong profitability and revenue growth are combined with expensive P/S, P/B, and P/FCF ratios, so the forecast should be lowered slightly due to overvaluation.

Varonis Systems VRNS reported second-quarter 2026 non-GAAP earnings of 4 cents per share, which beat the Zacks Consensus Estimate of 1 cent.
VRNS generated revenues of $180 million in the second quarter of 2026, surpassing the Zacks Consensus Estimate by 1.7%. Revenues increased from $152.2 million reported in the year-ago quarter.
Varonis beat the Zacks Consensus Estimates in three of the previous four quarters, while missing the same on one occasion, with an average surprise of 146.7%.
The quarter's performance was driven by continued SaaS momentum, robust demand for AI and data security offerings, healthy new customer additions and increasing adoption of newer products such as Atlas, Interceptor and Database Activity Monitoring.
Varonis Systems, Inc. Price, Consensus and EPS Surprise
VRNS SaaS Momentum Continues
Varonis' SaaS transition remained the primary growth driver during the quarter. SaaS revenues increased to $171.7 million from $105.9 million in the year-ago quarter, reflecting strong cloud adoption.
Legacy revenue streams continued to decline as customers migrated to the SaaS platform. Term license subscription revenues decreased to $4.2 million from $32.4 million a year ago, while maintenance and services revenues fell to $4.1 million from $13.9 million, with the majority of the decline attributable to SaaS conversions.
VRNS Returns to Operating Profit
Non-GAAP gross profit was $139.9 million, representing a 77.7% gross margin, compared with 80.6% in the prior-year quarter, reflecting the ongoing revenue mix shift toward SaaS.
Non-GAAP operating expenses totaled $136.1 million. The company reported non-GAAP operating income of $3.7 million against a non-GAAP operating loss of $1.9 million in the year-ago quarter. Non-GAAP operating margin improved to 2.1% from negative 1.2% a year earlier.
Strong Balance Sheet Supports Growth
As of June 30, 2026, Varonis held $911.5 million in cash, cash equivalents, short-term deposits and marketable securities.
For the first six months of 2026, the company generated $69.1 million in free cash flow compared with $82.7 million in the prior-year period. Adjusted for acquisition-related costs, adjusted free cash flow totaled $81.0 million.
AI Security Demand Drives Growth
Total SaaS ARR reached $726 million, up 52% year over year, while SaaS ARR excluding conversions grew 25% year over year to $598.1 million.
Management highlighted strong momentum from AI-driven demand, with SaaS ARR from new customers growing more than 20%. The company also cited growing adoption of newer offerings, including Atlas, Interceptor and Database Activity Monitoring, as organizations increasingly prioritize AI governance, data security and automated risk reduction.
Management noted that several large deals slipped into July due to market-related news flow late in the quarter but have since closed, contributing to a strong start to the third quarter and supporting increased confidence in full-year guidance.
VRNS Raises Full-Year Outlook
For the third quarter of 2026, Varonis expects revenues between $185 million and $188 million, suggesting 14-16% year-over-year growth. Non-GAAP operating income is expected to be in the range of $2.5 million to $3.5 million. Non-GAAP earnings per share are projected between 2 cents and 3 cents. SaaS ARR growth, excluding conversions, is expected to be in the range of 22-23% year over year.
For full-year 2026, Varonis raised its outlook and now expects revenues between $735 million and $739 million, implying 18-19% year-over-year growth. Total SaaS ARR is projected to be in the range of $819-$850 million. SaaS ARR growth, excluding conversions, is projected to be between 20% and 21% year over year. Free cash flow is expected to be in the band of $105-$110 million. Non-GAAP operating income is projected to be between $11 million and $13 million. Non-GAAP earnings per share are expected to be in the range of 14-15 cents.
Zacks Rank & Stocks to Consider
Varonis currently carries a Zacks Rank #4 (Sell).
Some better stocks in the broader Zacks Computer and Technology sector are Analog Devices ADI, Applied Materials AMAT and Cisco Systems CSCO, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Analog Devices have rallied 37.1% year to date. The Zacks Consensus Estimate for ADI’s fiscal 2026 earnings is pegged at $12.42 per share, up by 10 cents over the past 30 days, indicating an increase of 59.4% year over year.
Shares of Applied Materials have skyrocketed 101.1% year to date. The Zacks Consensus Estimate for AMAT’s fiscal 2026 earnings is pegged at $12.14 per share, up by 4 cents over the past 30 days, indicating a rise of 28.9% year over year.
Cisco Systems shares have surged 48.7% year to date. The Zacks Consensus Estimate for CSCO’s fiscal 2026 earnings is pegged at $4.28 per share, unchanged over the past 30 days, indicating an increase of 12.3% year over year.
Zacks' Research Chief Names "Stock Most Likely to Double"
Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.
This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.
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Varonis Q2 Earnings Surpass Expectations, Revenues Rise Y/Y

NXP Semiconductors N.V. NXPI reported better-than-expected second-quarter 2026 results, driven by broad-based strength across its end markets, accelerating adoption of software-defined vehicles, industrial processing solutions and growing demand from AI data center infrastructure.
The company’s second-quarter non-GAAP earnings of $3.61 per share increased 32.7% year over year and surpassed the Zacks Consensus Estimate of $3.54 by 1.98%.
Revenues increased 19.5% year over year to $3.50 billion, topping the consensus estimate by 0.8%.
NXPI's End Markets Deliver Broad-Based Growth
Automotive remained NXPI's largest business, generating $1.94 billion in revenues, up 12% year over year. Growth was fueled by continued momentum in software-defined vehicles, electrification and connectivity, with accelerating design wins for the S32 processor family and next-generation Ethernet switches.
NXP Semiconductors N.V. Price, Consensus and EPS Surprise
Industrial & IoT revenues rose 38% year over year to $755 million, benefiting from strong adoption of i.MX, RT and MCX processing platforms across factory automation and industrial applications.
Communication Infrastructure & Other revenues climbed 41% year over year to $452 million, supported by increasing data center networking demand and continued ramp-ups of UCODE RFID products.
Mobile revenues totaled $351 million, up 6% year over year, reflecting stable demand for secure mobile transaction solutions despite normal seasonal trends.
NXPI’s AI, Data Center Businesses Gain Momentum
Management highlighted AI as an increasingly important long-term growth driver, noting that AI workloads are moving beyond cloud infrastructure into vehicles, factories and robotics markets where NXP already maintains leadership positions.
The company reiterated that its 2026 data center revenues are expected to exceed $500 million compared with roughly $200 million in 2025. Growth is being driven by demand for control-plane processors, networking, rack management, cooling, power management and security applications used in hyperscale AI infrastructure.
NXPI’s Profitability Improves
Non-GAAP gross profit increased to $2.03 billion, while non-GAAP gross margin expanded 150 basis points year over year to 58.0%. Non-GAAP operating income rose 31% year over year to $1.23 billion, with operating margin improving 310 basis points to 35.1%, reflecting favorable product mix and higher operating leverage.
NXPI’s Strong Cash Generation Supports Shareholder Returns
NXP generated $860 million in operating cash flow during the quarter. Net capital expenditures totaled $69 million, resulting in non-GAAP free cash flow of $791 million, representing 22.6% of revenues.
The company returned $360 million to shareholders during the quarter through $256 million in dividends and $104 million in share repurchases. Following quarter-end, NXP repurchased an additional $32 million of shares under its 10b5-1 program. The company also repaid $750 million of senior unsecured notes using available cash.
NXPI Guides Strong Third Quarter
For the third quarter of 2026, NXP expects revenues between $3.65 billion and $3.85 billion. At the midpoint, revenues of $3.75 billion imply 7% sequential growth and 18% year-over-year growth.
The company projects non-GAAP gross margin of 58.5% at the midpoint, and non-GAAP earnings per share of $4.11, indicating continued operating leverage as demand strengthens across its key markets.
Zacks Rank & Other Stocks to Consider
NXPI currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the broader Zacks Computer and Technology sector are Analog Devices ADI, Applied Materials AMAT and Cisco Systems CSCO, each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Analog Devices have rallied 37.1% year to date. The Zacks Consensus Estimate for ADI’s fiscal 2026 earnings is pegged at $12.42 per share, up by 10 cents over the past 30 days, indicating an increase of 59.4% year over year.
Shares of Applied Materials have skyrocketed 101.1% year to date. The Zacks Consensus Estimate for AMAT’s fiscal 2026 earnings is pegged at $12.14 per share, up by 4 cents over the past 30 days, indicating a rise of 28.9% year over year.
Cisco Systems shares have surged 48.7% year to date. The Zacks Consensus Estimate for CSCO’s fiscal 2026 earnings is pegged at $4.28 per share, unchanged over the past 30 days, indicating an increase of 12.3% year over year.
Zacks' Research Chief Names "Stock Most Likely to Double"
Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.
This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.
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NXP Semiconductors N.V. (NXPI) : Free Stock Analysis Report
Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

NXP Semiconductors Q2 Earnings Beat Estimates, Revenues Rise Y/Y

Commvault Systems, Inc. CVLT reported first-quarter fiscal 2027 non-GAAP earnings of $1.42 per share, up 40.6% year over year. The figure beat the Zacks Consensus Estimate of $1.18 by 20.3%.
Revenues advanced 11.4% to $314.13 million and surpassed the consensus mark by 0.99%. Results benefited from strong SaaS demand, subscription growth and improving profitability. Subscription annual recurring revenues (ARR) increased 22% to $1.05 billion.
CVLT’s Subscription Revenues Maintain Momentum
Subscription revenues increased 16% year over year to $267.03 million and accounted for 85% of total revenues, up from 81% in the prior-year quarter.
Term-based license revenues rose 1% to $110.42 million, while term-based support revenues climbed 18% to $56.06 million. SaaS revenues surged 39% to $100.55 million, crossing the $100 million quarterly threshold for the first time.
Perpetual license revenues increased 19% to $8.70 million. However, perpetual support revenues declined 19% to $25.48 million, while other services revenues fell 7% to $12.93 million.
CommVault Systems, Inc. Price, Consensus and EPS Surprise
Commvault’s ARR Growth Reflects SaaS Strength
Subscription ARR reached $1.05 billion, up from $867.31 million a year earlier. CVLT added $39 million in net new subscription ARR during the quarter, driven by continued strength in its SaaS offerings.
SaaS ARR grew 38% to $424.34 million from $306.87 million. The company surpassed 10,000 active SaaS customers, while subscription net dollar retention remained steady at 114%.
Identity resilience and data security offerings represented more than one-third of net new subscription ARR. Emerging SaaS offerings, including Clumio S3 Protection, Google Workspace and Azure DevOps, also recorded strong growth.
CVLT Benefits From Broader Platform Adoption
The percentage of Commvault-managed SaaS customers using at least two products increased to 49% from 42% a year earlier. This reflected continued upselling and cross-selling across the Commvault Cloud Platform.
Management highlighted identity resilience as an important entry point for broader platform adoption. Demand was supported by customers seeking to protect identity systems, govern data access and recover operations following cyber incidents.
Commvault also expanded its relationship with Microsoft. Its cyber-resilience capabilities are expected to become available as a native independent software vendor service on Microsoft Azure, making the platform easier to integrate into Azure-based workflows.
Commvault’s Margins Expand on Operating Leverage
Gross margin reached 82.1% in the reported quarter. SaaS gross margin improved 635 basis points year over year to 70.6%, aided by product optimization, acquisition integration and strategic agreements with hyperscaler partners.
Operating expenses increased 7% to $185 million but declined as a percentage of revenues to 59% from 61% a year earlier. Headcount remained roughly flat year over year.
Non-GAAP EBIT increased to $71.47 million from $58.25 million. The corresponding margin expanded 210 basis points to 22.8%, marking the company’s strongest quarterly EBIT margin performance in more than a decade.
CVLT’s Cash Flow and Balance Sheet Remain Solid
Operating cash flow increased to $51.67 million from $31.68 million in the year-ago quarter. Free cash flow rose 71% to $51.10 million, reflecting stronger collections and continued spending discipline.
Commvault ended the quarter with cash and cash equivalents of $929.84 million, up from $899.99 million at the end of fiscal 2026. During the quarter, the company repurchased roughly 98,000 shares for $10 million.
Management continues to target share repurchases equal to approximately 60% of annual free cash flow while retaining balance sheet flexibility.
Commvault Updates Fiscal 2027 Profit Outlook
For the second quarter of fiscal 2027, subscription revenues are projected between $264 million and $268 million. Total revenues are expected to be approximately $310 million, while the non-GAAP EBIT margin is forecast at about 20%.
For fiscal 2027, CVLT raised its subscription revenue outlook to $1.119-$1.129 billion from $1.115-$1.125 billion. Subscription ARR guidance was maintained at $1.20-$1.21 billion, with SaaS ARR expected to exceed $500 million.
The company continues to expect total revenues of $1.30-$1.31 billion and free cash flow of $250-$260 million. Non-GAAP EBIT margin guidance was increased by 50 basis points to approximately 21%.
CVLT’s Zacks Rank and Stocks to Consider
Commvault currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Computer and Technology sector are Analog Devices ADI, Applied Materials AMAT and Cisco Systems CSCO, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Analog Devices have rallied 34.9% year to date. The Zacks Consensus Estimate for Analog Devices’ fiscal 2026 earnings is pegged at $12.42 per share, up by 10 cents over the past 30 days, indicating a 59.4% year-over-year increase.
Shares of Applied Materials have skyrocketed 85.4% year to date. The Zacks Consensus Estimate for Applied Materials’ fiscal 2026 earnings is pegged at $12.14 per share, up by 3 cents over the past 30 days, calling for a rise of 28.9% year over year.
Cisco Systems shares have surged 50.1% year to date. The Zacks Consensus Estimate for CSCO’s fiscal 2026 earnings is pegged at $4.28 per share, unchanged over the past 30 days, implying an increase of 12.3% year over year.
Zacks' Research Chief Names "Stock Most Likely to Double"
Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.
This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.
Free: See Our Top Stock And 4 Runners Up
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

CVLT Q1 Earnings Beat Estimates, Revenues Rise Y/Y on SaaS Growth

Logitech International S.A. LOGI reported first-quarter fiscal 2027 non-GAAP earnings of $1.85 per share, up 47% year over year. The metric topped the Zacks Consensus Estimate by 39.1%. Revenues rose 7% to $1.23 billion and beat the consensus mark by 2.1%.
The results reflected strong demand for premium pointing devices, gaming products and video collaboration solutions. Non-GAAP gross margin expanded 770 basis points to 49.8%, aided by $61 million in tariff refunds, favorable currency movements, product mix and cost reductions.
LOGI's Product Categories Show Broad Strength
Gaming revenues increased 12% year over year to $354.2 million, with constant-currency growth of 9%. The PRO X2 SUPERSTRIKE mouse supported gaming-mouse momentum, while the Americas and Asia Pacific delivered solid growth.
Pointing Devices revenues climbed 16% to $227.3 million, or 14% in constant currency, driven by a shift toward premium products such as the MX Master 4. Video Collaboration sales advanced 11% to $185.3 million, extending demand from workplace customers. The company also gained about 220 basis points of share across personal workspace products.
Logitech International S.A. Price, Consensus and EPS Surprise
Logitech Faces Weakness in Select Categories
Keyboards & Combos revenues rose 2% to $227.8 million, as strength in the Americas offset weakness in the EMEA. Tablet Accessories sales slipped 2% to $89.4 million against a difficult prior-year comparison tied to a large education contract.
Webcam revenues declined 9% to $76.6 million, while Headsets fell 3% to $44.1 million. Other-category revenues dropped 12% to $22.5 million, reflecting softness in mobile and PC speakers.
LOGI's Regional Mix Supports Growth
Americas sales grew 11% in constant currency, led by double-digit gains in Gaming, Keyboards & Combos and Pointing Devices. Asia Pacific increased 5%, with China outperforming the broader region amid strong execution around the June 18 shopping festival.
EMEA sales declined 4% as the Middle East conflict reduced regional growth by roughly 400 basis points. Even so, Logitech gained share in Europe despite subdued consumer and enterprise demand.
Logitech's Margins Benefit From Refunds and Mix
Non-GAAP operating expenses increased 14% to $320.4 million, reflecting higher investments in sales and marketing and research and development. General & administrative expenses remained controlled at 2.8% of sales.
Non-GAAP operating income surged 44% to $290 million. Excluding tariff refunds, operating income rose 14% to $229 million, showing that stronger mix and execution also supported profitability beyond the one-time benefit.
LOGI Generates Solid Cash Flow and Returns Capital
Cash flow from operations increased to $166.7 million from $125 million a year earlier. Logitech ended the quarter with $1.75 billion in cash and cash equivalents, while inventories were $491.7 million.
The company repurchased $113.6 million of shares during the quarter. Management also noted that channel inventory remained within the operating ranges seen since the start of fiscal 2025.
Logitech Issues Cautious Q2 Outlook
For the second quarter of fiscal 2027, Logitech expects revenues between $1.19 billion and $1.22 billion, implying year-over-year growth of 0-3% on both a reported and constant-currency basis. Non-GAAP operating income is projected between $185 million and $210 million.
The outlook includes an estimated $20 million revenue headwind from a semiconductor supplier shutdown. Based on limited information, management sees a potential impact of up to $200 million in the third quarter, with the disruption expected to be largely resolved by the fourth quarter.
LOGI Maintains Long-Term Margin View
Logitech has not issued formal full-year revenue guidance. Excluding the supplier disruption, management said demand momentum would continue at roughly the first-quarter pace through the balance of fiscal 2027.
The company still expects full-year non-GAAP operating margin to track near the high end of its 15-18% long-term target range. Strong underlying execution and the tariff refunds are expected to support that profitability level despite continued growth investments.
Logitech’s Zacks Rank and Stocks to Consider
LOGI currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Computer and Technology sector are Analog Devices ADI, Applied Materials AMAT and Cisco Systems CSCO, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Analog Devices have rallied 34.9% year to date. The Zacks Consensus Estimate for Analog Devices’ fiscal 2026 earnings is pegged at $12.42 per share, up by 10 cents over the past 30 days, indicating a 59.4% year-over-year increase.
Shares of Applied Materials have skyrocketed 85.4% year to date. The Zacks Consensus Estimate for Applied Materials’ fiscal 2026 earnings is pegged at $12.14 per share, up by 3 cents over the past 30 days, suggesting a rise of 28.9% year over year.
Cisco Systems shares have surged 50.1% year to date. The Zacks Consensus Estimate for CSCO’s fiscal 2026 earnings is pegged at $4.28 per share, unchanged over the past 30 days, calling for an increase of 12.3% year over year.
Zacks' Research Chief Names "Stock Most Likely to Double"
Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.
This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.
Free: See Our Top Stock And 4 Runners Up
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Logitech Q1 Earnings Beat Estimates on Tariff Refunds, Premium Demand

Manhattan Associates MANH reported second-quarter 2026 non-GAAP adjusted earnings of $1.39 per share, beating the Zacks Consensus Estimate by 6.11% and increasing 6.11% year over year.
Revenues beat the consensus mark by 3.76% and climbed 9.31% year over year to $297.8 million. Management reported better-than-expected revenues and profitability, accelerating cloud growth, and a sharp increase in remaining performance obligations.
RPO increased to $2.47 billion as of June 30, 2026, compared to $2.35 billion as of March 31, 2026, representing 23% growth year over year.
Manhattan Associates, Inc. Price, Consensus and EPS Surprise
MANH's Q2 Top-Line Details
Cloud subscription revenues surged 26.19% year over year to $126.7 million. Software license revenues rose 25.85% year over year to $1.9 million, reflecting stronger deal activity within a still small revenue base. Maintenance revenues slipped 12.93% year over year to $30.5 million as customers continued migrating to cloud native deployments. Services revenues grew 3.22% year over year to $133.0 million. Hardware revenues declined 14.37% year over year to $5.6 million.
On a geographic basis, Americas revenues grew 9.88% year over year to $227 million. EMEA revenues increased 5.88% year over year to $55.4 million. APAC revenues rose 13.99% year over year to $15.4 million.
Operating Details of MANH
GAAP total costs and expenses rose 16.58% year over year to $231.6 million, driven in part by an $8.3 million restructuring charge tied to the June headcount reduction. GAAP operating income declined 10.24% year over year to $66.2 million. Non-GAAP adjusted operating income increased 2.75% year over year to $103.9 million.
GAAP net income declined 11.32% year over year to $50.4 million while GAAP diluted EPS fell 8.6% year over year to 85 cents, reflecting the restructuring expense and elevated equity-based compensation costs relative to the year-ago period. Non-GAAP adjusted diluted EPS grew 6.11% year over year to $1.39.
MANH's Q2 Balance Sheet & Cash Flow
Cash flow from operations grew 22.57% year over year to $90.7 million. Days Sales Outstanding improved to 67 days at June 30, 2026 from 72 days at March 31, 2026. Cash totaled $186.1 million at June 30, 2026, down 17.69% from $226.1 million at March 31, 2026, largely reflecting continued share repurchase activity.
Capital expenditures were $1 million in the second quarter of 2026, down 74.75% year over year from $4 million in the second quarter of 2025. Manhattan Associates ended the quarter with no debt on its balance sheet.
During the three months ended June 30, 2026, the company repurchased approximately 874,029 shares for a total of $125.0 million. Over the six months ended June 30, 2026, total repurchases reached 1,917,341 shares for $275.0 million. Approximately $225 million remained under the existing March 2026 repurchase authority as of quarter end.
MANH's 2026 Guidance
For full-year 2026, Manhattan Associates raised guidance for total revenues to a range of $1.16 billion to $1.166 billion, implying 7-8% growth. GAAP operating margin guidance is 24.2% to 24.4% while non-GAAP adjusted operating margin is expected at 35-35.2%. GAAP EPS is projected at $3.59-$3.65 while non-GAAP adjusted EPS is guided at $5.44-$5.5, representing 8-9% growth.
Full-year 2026 cloud revenue guidance was raised, with the midpoint increasing to $505.5 million, implying approximately 24% growth.
Zacks Rank & Stocks to Consider
MANH currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Computer and Technology sector are Analog Devices ADI, Applied Materials AMAT and Cisco Systems CSCO, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Analog Devices have rallied 34.8% year to date. The Zacks Consensus Estimate for ADI’s fiscal 2026 earnings is pegged at $12.42 per share, up by 10 cents over the past 30 days, indicating an increase of 59.4% year over year.
Shares of Applied Materials have skyrocketed 85.4% year to date. The Zacks Consensus Estimate for AMAT’s fiscal 2026 earnings is pegged at $12.14 per share, up by 4 cents over the past 30 days, indicating a rise of 28.9% year over year.
Cisco Systems shares have surged 50% year to date. The Zacks Consensus Estimate for CSCO’s fiscal 2026 earnings is pegged at $4.28 per share, unchanged over the past 30 days, indicating an increase of 12.3% year over year.
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MANH Q2 Earnings Beat Estimates, Cloud Growth Fuels Revenues

For Immediate Release
Chicago, IL – July 29, 2026 – Today, Zacks Equity Research discusses Cisco Systems CSCO, Extreme Networks EXTR and Digi International DGII.
Industry: Computer Networking
Link: https://www.zacks.com/commentary/2961703/3-stocks-to-consider-from-networking-industry-battered-by-headwinds
Cautious IT spending amid heightened uncertainty over global macroeconomic conditions and volatile supply-chain dynamics due to tariff troubles continues to be concerning for the participants in the Zacks Computer - Networking industry in the near term. Fierce competition is an overhang on pricing power and margin expansion.
However, over the long term, the participants are expected to benefit from the networking infrastructure upgrade driven by AI workloads, cloud computing, big data, network security and next-generation connectivity.
The proliferation of AI workloads and hyperscale data centers is accelerating investments in high-speed interconnects, optical networking and Ethernet switches. Players in this space are focused on capitalizing on the multi-billion-dollar AI infrastructure opportunity. The rapid deployment of 5G is fueling the proliferation of the Internet of Things (IoT), Advanced Driver Assistance Systems, Augmented Reality/Virtual Reality (AR/VR) devices and 5G smartphones, driving demand for robust networking infrastructure. The Wi-Fi 7 upgrade cycle will act as a catalyst.
Also, the explosion of AI workloads requires a major upgrade to observability infrastructure. There is a greater need for continuous monitoring of hybrid environments and tighter security amid rising attacks. This will spur demand for innovative networking products, favoring prospects for prominent industry players such as Cisco Systems, Extreme Networks and Digi International.
Industry Description
The Zacks Computer-Networking industry comprises companies that offer networking and Internet-connected products, including wireless (Wi-Fi and Long-Term Evolution or LTE), Ethernet and powerline, focusing on dependability and ease of use. The products are available in numerous configurations to cater to the changing requirements of consumers in each geographic territory where it operates.
Some industry players also provide mission-critical IoT solutions and network security services to help clients build next-generation connected products, and implement and manage critical communications infrastructures in demanding environments with enhanced safety levels. Focus on developing IoT sensors, drones and wearables amid increasing demand for cloud computing-based contact tracing applications is driving the industry.
4 Trends Influencing the Industry's Future
Technological Advancement Opening Business Avenues: The proliferation of AI and high adoption of cloud and data-intensive applications is driving higher traffic and creating a need for advanced optical networking, high-speed interconnects, Ethernet switches, routing and wireless infrastructure. Expansion of industrial IoT and edge computing, and the increasing popularity of smart connected devices are further creating growth opportunities. Rising cybersecurity concerns are emerging as a key tailwind, driving demand for solutions such as threat detection, network monitoring and zero-trust security architectures.
Rapid Deployment of 5G to Boost Growth Prospects: The success of the 5G technology hinges on substantial investments to upgrade infrastructure in the core fiber backhaul network to support growth in data services. Efforts to develop smart connected homes, hospitals, factories, buildings, cities and self-driving vehicles bode well for industry players. These firms invest heavily in LTE, broadband and fiber to provide additional capacity and improve Internet and wireless networks. These initiatives hold promise.
Wi-Fi 7 Upgrade Cycle to Drive Momentum: Brisk technological advancement, dynamic products, high-speed connectivity, low latency and evolving industry standards define the networking industry. The growing clout of the latest Wi-Fi 6E-compliant residential gateways, Wi-Fi routers, set-top boxes and wireless range extenders is a testament to the same.
The increasing demand for connecting more devices to the network has been driving demand for Wi-Fi 6E devices. Wi-Fi 6E addresses Wi-Fi spectrum shortage issues by providing continuous channel bandwidth to support a higher number of connected devices without compromising speed. The rollout of Wi-Fi 7 bodes well for the companies in this space.
Macroeconomic Turmoil Is Concerning: Global macroeconomic weakness and volatile supply-chain dynamics are persistent concerns. Tariff troubles, especially between the United States and China, remain an overhang on global supply chains. Inflation could affect spending across small and medium-sized businesses globally and uncertainty in business visibility could dent the industry’s near-term performance.
The computer networking industry remains highly competitive, with a large number of established and new players vying for market share. As growth stabilizes, competition often intensifies, leading to pricing pressure and margin compression.
Zacks Industry Rank Indicates Bleak Near-Term Prospects
The Zacks Computer-Networking Industry is housed within the broader Zacks Computer and Technology sector. The industry carries a Zacks Industry Rank #167, positioning it in the bottom 32% of more than 247 Zacks industries.
The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all the member stocks, indicates bleak near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.
Before we present a few stocks you may want to consider for your portfolio, considering bright prospects, let us look at the industry’s recent stock-market performance and valuation picture.
Industry Outperforms the S&P 500 and the Sector
The Zacks Computer-Networking industry has outperformed the S&P 500 composite and the broader Zacks Computer and Technology sector in the past year.
The industry has gained 67.4% over this period, compared with the broader sector’s 24.3% rally. The S&P 500 has appreciated 18.4% over the same time frame.
Industry's Current Valuation
Based on the forward 12-month price-to-earnings (P/E) ratio, a common multiple for valuing Computer-Networking stocks, the industry is currently trading at 28.78X, compared with the S&P 500’s 20.11X. It is also higher than the sector’s forward-12-month P/E of 20.64X.
In the past five years, the industry traded as high as 31.47X and as low as 12.45X, with the median being 17.27X.
3 Computer-Networking Stocks to Add to Portfolio
Cisco Systems: Headquartered in San Jose, CA, the company offers identity and access, advanced threat and unified threat management solutions.
Cisco is benefiting from the demand for AI Infrastructure solutions, with hyperscaler demand acting as a key catalyst. The company expects its networking portfolio, led by Silicon One, AI native security solutions and operating systems, to support top-line expansion moving forward. The company expects AI hyperscale revenues to ramp considerably, and expects at least $6 billion in AI-related revenues for fiscal 2027.
In the third quarter of fiscal 2026, AI infrastructure orders from hyperscalers came in at $1.9 billion, taking year-to-date total to $5.3 billion. The company also raised expected hyperscaler AI orders to $9 billion and expected AI infrastructure revenues from hyperscalers to about $4 billion for fiscal 2026.
Within its core Networking segment, Cisco is witnessing robust traction across the enterprise data center switching business, as customers prepare their infrastructure for agentic applications and AI inferencing.
Acacia business is also witnessing strong growth as hyperscalers deploy both 400G and 800G coherent optics, with 800G pluggables gaining significant traction.
CSCO returned $2.9 billion to its shareholders through repurchases and dividends in the last reported quarter. The Zacks Consensus Estimate for fiscal 2026 bottom line is pinned at $4.28, unchanged in the past 30 days. Shares have gained 68.6% in the past year.
At present, CSCO carries a Zacks Rank #2 (Buy). You can seethe complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Extreme Networks: Based in Morrisville, NC, the company provides AI-driven cloud networking solutions. Strong demand for the company’s networking solutions bodes well. EXTR expects revenues to be $1.275 billion to $1.28 billion for fiscal 2026.
Extreme’s launch of Platform ONE and pivot to a recurring model is supporting growth amid solid enterprise networking demand. In the fiscal third quarter, revenue growth was11% year over year while product revenues were up 12% from the prior-year quarter.
Momentum in subscription bookings is expected to grow with the adoption of Platform ONE and drive up SaaS annual recurring revenues (“ARR”). In the fiscal third quarter, SaaS ARR rose 29% year over year to $236 million. Extreme closed 44 deals, each worth more than $1 million, signaling stronger deal quality and strategic growth.
EXTR also launched Extreme Agent ONE, a new set of AI agents designed for enterprise networking in May 2026.
Wi-Fi 7 is emerging as a key catalyst, driving network refresh cycles. It recently unveiled Extreme Multi-Beam Wireless, a next-generation stadium Wi-Fi connectivity solution. This solution is designed for high-density environments and supports higher bandwidth.
However, the company continues to face component pricing pressure as well as supply chain issues. To tackle these, EXTR has secured its supply chain through fiscal 2027, improving fulfillment certainty and margin visibility.
At present, EXTR carries a Zacks Rank #3 (Hold). The Zacks Consensus Estimate for fiscal 2026 earnings is pegged at $1.04, unchanged in the past 30 days. Shares are up 67.2% in the past year.
Digi International: Based in Hopkins, MN, Digi is a well-known provider of business and mission-critical Internet of Things (IoT) products and services globally. The company’s industrial Internet of Things offerings encompass embedded, edge and turnkey vertical solutions. These solutions find applications across emerging technology trends such as AI, edge computing and industrial automation. Digi is embedding AI across its portfolio.
Digi’s outlook remains supported by sustained ARR growth, ongoing benefits from acquisitions and the long-term opportunity to integrate AI into industrial IoT solutions. The company expects ARR to grow 25% in fiscal 2026, reaching around $190 million by the end of the year.
To capitalize on the AI opportunity, DGII recently unveiled DANI, the Digi Artificial Network Intelligence agent. DANI is an AI network operations agent that is embedded in Digi Remote Manager, a networking device management platform, enabling network operators/managed service providers to monitor network issues, identify causes, and offer recommended actions through a unified conversational interface.
Digi continues to pursue strategic acquisitions, which are likely to supplement organic growth.
Management highlighted challenges in the supply chain, including higher memory pricing and energy-driven freight costs, which continue to create cost volatility.
At present, DGII carries a Zacks Rank #3. The Zacks Consensus Estimate for fiscal 2026 bottom line is pegged at $2.48, unchanged in the past 30 days. Shares have gained 101.3% in the past year.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Zacks' Research Chief Names "Stock Most Likely to Double"
Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.
This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.
Free: See Our Top Stock And 4 Runners Up
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Zacks Industry Outlook Highlights Cisco Systems, Extreme Networks and Digi International

F5, Inc. FFIV delivered better-than-expected third-quarter fiscal 2026 results. The company reported third-quarter fiscal 2026 non-GAAP earnings of $4.73 per share, which increased 14% year over year. The figure surpassed the Zacks Consensus Estimate by 18.8%.
Revenues increased 11% year over year to $865 million and beat the consensus mark by 3.96%. Results benefited from 32% systems revenue growth, sustained hybrid multicloud demand and growing application security requirements. Product revenues advanced 19%, marking the eighth consecutive quarter of double-digit growth.
FFIV's Q3 Segment Revenue Details
Product revenues, representing 54% of total revenues, increased 19% year over year to $463 million. Systems revenues jumped 32% to $240 million as customers invested in higher-performance infrastructure, expanded data-center capacity and modernized environments for resiliency, digital sovereignty and AI workloads.
Software revenues rose 7% to $223 million. Subscription-based software revenues increased 9% to $201 million and represented 90% of software revenues. Perpetual license revenues declined 4% to $22 million. Services revenues, accounting for 46% of total revenues, grew 3% to $402 million.
F5, Inc. Price, Consensus and EPS Surprise
F5 Benefits From Hybrid Multicloud Demand
Management highlighted expansion opportunities tied to hybrid multicloud adoption, including competitive displacements, platform consolidation and data-center buildouts. An energy and utilities provider expanded its BIG-IP footprint after moving workloads from an unstable cloud environment back to on-premises infrastructure.
F5 also secured a competitive win at a Fortune 100 technology provider seeking to strengthen delivery and security for a storage service spanning 45 data centers. The customer selected BIG-IP to support the availability, resilience and security requirements of AI and data-intensive workloads.
F5 Maintains Solid Margins and Cash Flow
Non-GAAP gross margin expanded 110 basis points year over year to 84.2%, while non-GAAP operating margin increased 70 basis points to 35%.
In the third quarter of fiscal 2026, FFIV generated $316 million in operating cash flow and $281 million in free cash flow.
Cash and investments totaled $1.63 billion, up from $1.44 billion in the previous quarter. The company repurchased $100 million of shares and had $422 million remaining under its authorization.
FFIV Raises Fiscal 2026 Outlook
F5 expects fourth-quarter fiscal 2026 revenues between $870 million and $890 million, implying growth of nearly 9% at the midpoint. Non-GAAP earnings are projected in the range of $4.14-$4.26 per share. Non-GAAP gross margin is expected between 83% and 84%, reflecting a favorable mix of higher-performance systems and lower component-cost increases than initially anticipated.
The Zacks Consensus Estimate for fourth-quarter fiscal 2026 revenues and earnings is currently pegged at $854.33 million and $4.12 per share, respectively.
For fiscal 2026, management raised its revenue growth forecast to approximately 9-10% from 7-8%. The company continues to expect mid-single-digit software growth, double-digit systems growth and low-single-digit services growth. Non-GAAP earnings guidance was increased to $17.21-$17.33 per share from $16.25-$16.55.
The Zacks Consensus Estimate for fiscal 2026 revenues and earnings is currently pegged at $3.32 billion and $16.45 per share, respectively.
FFIV’s Zacks Rank and Stocks to Consider
Currently, F5 carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Computer and Technology sector are Analog Devices ADI, Applied Materials AMAT and Cisco Systems CSCO, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Analog Devices have rallied 37.1% year to date. The Zacks Consensus Estimate for ADI’s fiscal 2026 earnings is pegged at $12.42 per share, up by 10 cents over the past 30 days, indicating an increase of 59.4% year over year.
Shares of Applied Materials have skyrocketed 101.1% year to date. The Zacks Consensus Estimate for AMAT’s fiscal 2026 earnings is pegged at $12.14 per share, up by 4 cents over the past 30 days, indicating a rise of 28.9% year over year.
Cisco Systems shares have surged 48.7% year to date. The Zacks Consensus Estimate for CSCO’s fiscal 2026 earnings is pegged at $4.28 per share, unchanged over the past 30 days, indicating an increase of 12.3% year over year.
Beyond Nvidia: AI's Second Wave Is Here
The AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. AI’s second wave is moving from infrastructure to implementation and these companies are at the forefront of this transition, positioned to become what Amazon and Google were to the internet era.
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FFIV Beats Q3 Earnings Estimates on Systems Strength, Raises View

Navitas Semiconductor Corporation NVTS reported second-quarter 2026 non-GAAP loss of 4 cents per share, in line with the Zacks Consensus Estimate. The figure was narrower than the year-ago quarter’s loss of 5 cents.
Navitas Semiconductor’s second-quarter 2026 revenues of $10.5 million declined 27.3% year over year but beat the consensus estimate by 5.8%. The top line increased 22% sequentially as revenues from high-power markets grew more than 50% year over year. Management also highlighted an expanding backlog and record book-to-bill, reflecting stronger demand across AI data centers and grid and energy infrastructure.
NVTS Builds Momentum in High-Power Markets
High-power products accounted for the majority of second-quarter revenues, while mobile and low-end consumer sales declined both sequentially and year over year. Both gallium nitride, or GaN, and silicon carbide, or SiC, contributed to the sequential improvement.
The company expects mobile and low-end consumer revenues to become insignificant by year-end. AI infrastructure, which combines data centers with grid and energy infrastructure, is projected to represent more than one-third of fourth-quarter sales.
Navitas Semiconductor Corporation Price, Consensus and EPS Surprise
Navitas Semiconductor Corporation price-consensus-eps-surprise-chart | Navitas Semiconductor Corporation Quote
NVTS Targets Multiple AI Power Inflections
The first growth phase is already underway as higher rack power and density requirements drive silicon-to-SiC replacement in AC/DC power supply units. Management expects this trend to accelerate in the second half of 2026 and the first half of 2027.
A second phase is expected around mid-2027 as power shelves and battery backup units move into 800-volt sidecar racks. Native 800-volt power delivery to compute trays should follow, increasing GaN content near GPUs and other processors, while solid-state transformers could expand ultra-high-voltage SiC and GaN opportunities from 2028.
Navitas Improves Mix and Gross Margin
Non-GAAP gross margin expanded 50 basis points sequentially and 100 basis points year over year to 39.5%. The improvement reflected a greater contribution from higher-value high-power products and better scale.
Non-GAAP operating expenses were $15.5 million, down from $16.1 million a year earlier. The company recorded a non-GAAP operating loss of $11.4 million compared with a loss of $11.7 million in the prior quarter and $10.6 million in the year-ago period.
NVTS Strengthens Liquidity Ahead of Growth
Navitas ended the first quarter of 2026 with $557 million in cash and cash equivalents, up from $221 million at the end of the first quarter, primarily due to approximately $373 million of capital raised during the period. Navitas remained debt-free.
Inventory increased to $19.5 million from $14.9 million as the company began building TSMC wafer buffers. Prepaid expenses and other current assets also rose by roughly $15 million, reflecting planned wafer purchases to support expected AI data center demand and the transition to U.S.-based GaN manufacturing.
NVTS’ Outlook Calls for Continued Sequential Growth in Q3
For the third quarter of 2026, Navitas expects revenues of $13 million to $14 million. The $13.5 million midpoint implies 28% sequential growth and a return to year-over-year expansion. The Zacks Consensus Estimate for revenues is currently pegged at $11.38 million, indicating a 12.5% increase from the year-ago reported quarter.
Non-GAAP gross margin is projected at 38.7% to 40.7%. Non-GAAP operating expenses are expected between $15.5 million and $17.5 million as the company increases spending on product development, customer support and supply-chain readiness.
Zacks Rank & Stocks to Consider
Navitas Semiconductor currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Computer and Technology sector are Analog Devices ADI, Applied Materials (AMAT) and Cisco Systems CSCO, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Analog Devices have rallied 37.1% year to date. The Zacks Consensus Estimate for ADI’s fiscal 2026 earnings is pegged at $12.42 per share, up by 10 cents over the past 30 days, indicating an increase of 59.4% year over year.
Shares of Applied Materials have skyrocketed 101.1% year to date. The Zacks Consensus Estimate for AMAT’s fiscal 2026 earnings is pegged at $12.14 per share, up by 4 cents over the past 30 days, indicating a rise of 28.9% year over year.
Cisco Systems shares have surged 48.7% year to date. The Zacks Consensus Estimate for CSCO’s fiscal 2026 earnings is pegged at $4.28 per share, unchanged over the past 30 days, indicating an increase of 12.3% year over year.
Beyond Nvidia: AI's Second Wave Is Here
The AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. AI’s second wave is moving from infrastructure to implementation and these companies are at the forefront of this transition, positioned to become what Amazon and Google were to the internet era.
See Stocks Now >>
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

NVTS Q2 Earnings Meet Estimates, Revenues Beat on High-Power Growth

Cloud computing stocks have been among Wall Street’s strongest performers in 2026, driven by the rapid expansion of artificial intelligence (AI), enterprise digital transformation and rising demand for computing infrastructure. Businesses are accelerating cloud adoption to support AI models, data analytics and cybersecurity, while governments and large enterprises continue migrating critical workloads to the cloud. Investors have rewarded companies exposed to these long-term structural trends. Alphabet Inc. GOOGL, Cisco Systems, Inc. CSCO and Cloudflare, Inc. NET are three such stocks that have been making the most of the current environment.
The sector has also benefited from heavy spending on data centers and AI infrastructure. Enterprises are increasing capital expenditure to build more powerful cloud environments capable of handling generative AI applications, creating a strong outlook for cloud-related revenue. Meanwhile, easing concerns over interest rates have supported high-growth technology stocks, as lower financing costs improve the valuation of companies expected to deliver robust earnings growth over the coming years.
Another key catalyst has been the improving corporate spending environment. Companies that delayed technology investments amid economic uncertainty are once again committing budgets to cloud migration, automation and software modernization. Recurring subscription-based revenue, high customer retention and expanding demand for cloud-native applications have strengthened investor confidence that the industry's growth can remain resilient even if the broader economy slows.
Investors looking ahead to August may find the sector attractive because several near-term catalysts remain in place, including continued AI-related spending, ongoing enterprise cloud adoption and a busy earnings season that could reinforce expectations for sustained revenue growth. Although valuations have become richer after this year's rally, cloud computing remains one of the market's most compelling long-term investment themes, supported by durable demand, expanding digital infrastructure and the central role cloud platforms play in the global AI revolution.
Our Choices
The stocks below flaunt a Zacks Rank #1 (Strong Buy) or Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Alphabet, a Zacks Rank #2 company, is a leading cloud-computing provider through Google Cloud, offering AI infrastructure, Vertex AI, Gemini Enterprise, cybersecurity, data analytics and Google Workspace. Its expanding cloud platform is a key driver of enterprise digital transformation and AI adoption worldwide. GOOGL’s expected earnings growth rate for the current year is 64.8%. The Zacks Consensus Estimate for its current-year earnings has improved 24.6% over the past 60 days. Its shares have gained 4.3% year to date.
Cisco, a Zacks Rank #2 company, provides cloud networking and infrastructure solutions, enabling secure data centers, hybrid and multi-cloud environments, cybersecurity, observability and collaboration. Its technologies help enterprises modernize networks, strengthen cloud security and accelerate digital transformation worldwide. CSCO’s expected earnings growth rate for the current year is 12.3%. The Zacks Consensus Estimate for its next-year earnings has improved 1.5% over the past 60 days. Its shares have surged 48.7% year to date.
Cloudflare, a Zacks Rank #1 company, provides cloud-native networking, security and developer services, helping businesses secure applications, optimize performance and deploy AI-powered workloads across public, private and hybrid cloud environments through its global cloud platform. NET’s expected earnings growth rate for the current year is 30.1%. The Zacks Consensus Estimate for its next-year earnings has improved 9.9% over the past 60 days. Its shares have soared 34.7% year to date.
Bottom Line
Cloud computing remains one of the most compelling long-term investment themes as AI adoption, enterprise digital transformation and rising infrastructure spending continue to fuel demand. With strong earnings growth prospects, improving analyst estimates and favorable Zacks Ranks, Alphabet, Cisco and Cloudflare appear well-positioned to benefit from the sector's momentum heading into August and beyond.
Beyond Nvidia: AI's Second Wave Is Here
The AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. AI’s second wave is moving from infrastructure to implementation and these companies are at the forefront of this transition, positioned to become what Amazon and Google were to the internet era.
See Stocks Now >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

3 Top Cloud Computing Stocks Worth Buying Before August

Artificial intelligence is rapidly transforming customer engagement as enterprises adopt conversational AI, intelligent virtual agents and automation to improve customer experience while lowering service costs. Companies that can deliver scalable, enterprise-grade AI platforms are expected to benefit from this multiyear technology shift. SoundHound AI SOUN and Five9 FIVN are among the companies capitalizing on this opportunity, but they approach the market from different angles.
SoundHound has evolved into a voice-first, agentic AI platform serving industries ranging from automotive and restaurants to financial services, while Five9 remains a leader in cloud contact center software that is embedding AI across its customer experience platform.
Let's dive deep and closely compare the fundamentals of the two stocks to determine which one is a better investment now.
The Case for SoundHound Stock
SoundHound continues to position itself as one of the fastest-growing pure-play conversational AI companies. In the first quarter of 2026, revenues increased 52% year over year, while its core Automotive and IoT AI business grew 88%, excluding acquisitions, highlighting robust underlying demand. The company also unveiled OASYS, its self-learning agentic AI platform that enables enterprises to build, deploy and continuously improve AI agents across voice, text, chat, kiosks and other customer touchpoints.
The pending acquisition of LivePerson represents another major growth catalyst. The transaction is expected to create one of the industry's largest conversational AI customer bases, spanning 25 Fortune 100 companies and more than 30 countries. Management expects substantial cross-selling opportunities by combining SoundHound's voice AI with LivePerson's digital messaging capabilities, while projecting a long-term revenue opportunity of roughly $500 million from the combined customer base.
Beyond acquisitions, SoundHound continues to expand across restaurants, automotive, financial services, healthcare, telecommunications and retail. Management highlighted increasing enterprise wins, growing adoption of Voice Insights analytics and strong customer ROI from its AI-powered drive-thru solutions. The company also ended the quarter with $216 million in cash and no debt, providing flexibility to fund future expansion.
Nevertheless, the investment case still carries meaningful risks. The company remains unprofitable, with negative adjusted EBITDA and operating cash flow. Integrating LivePerson while simultaneously investing heavily in proprietary AI models could pressure margins further if anticipated revenue synergies take longer than expected to materialize.
The Case for Five9 Stock
Five9 offers investors a more mature AI story built on a profitable cloud contact center platform. Rather than pursuing rapid acquisitions, the company has focused on integrating generative AI into its existing intelligent customer experience platform while maintaining disciplined financial execution.
First-quarter 2026 results reflected that strategy. Revenues increased 9% year over year to $305 million, while subscription revenues accelerated 13%. More importantly, adjusted EBITDA rose 41%, operating cash flow increased 32% and free cash flow climbed 42%, demonstrating continued operating leverage. Dollar-based retention rates of 105% overall and 107% for subscription customers indicate that existing clients continue expanding their usage of the platform.
Five9 is also strengthening its competitive position through AI Agents, GenAI Studio and partnerships such as its enterprise AI solution with Google Cloud. Management believes AI significantly expands its addressable market by extending beyond cloud contact center software into AI-driven labor automation, creating a substantially larger long-term opportunity.
Financial discipline further strengthens the investment thesis. During the latest quarter, Five9 announced a new $200 million share repurchase authorization after completing the remaining balance of its previous program, highlighting confidence in future cash generation. The company also reaffirmed its full-year outlook despite macroeconomic uncertainty.
The primary challenge is moderating growth. Revenue expansion has slowed into the high-single digits as the company has matured. Management also acknowledged that AI could gradually reduce traditional subscription revenues if newer AI offerings fail to fully offset evolving customer purchasing patterns.
Five9 Has Outperformed in the Market
The market has rewarded Five9's improving profitability while remaining cautious toward SoundHound's higher-risk growth strategy. Five9 shares have gained 15.3% year to date (YTD), outperforming both the Zacks Computer and Technology sector, which has advanced 9.7%, and the S&P 500, up 7.5%. In comparison, SoundHound shares have plunged 38.2% over the same period.
SOUN vs FIVN Price Performance (YTD)
Image Source: Zacks Investment Research
Among comparable enterprise AI and customer experience software companies, Cisco Systems CSCO has surged 68.1% YTD as investors increasingly recognize its AI networking opportunity. Meanwhile, NICE Ltd. NICE has lost 47% amid softer demand for customer experience software and competitive pressures. While SoundHound has significantly lagged Five9 and Cisco, it has performed better than NICE.
SoundHound Commands the Premium Multiple
The valuation gap between the two companies reflects their contrasting business models and investor expectations. On a forward 12-month price-to-sales basis, SoundHound trades at 10.49X, well above the Zacks Computer and Technology sector average of 6.18X, suggesting investors continue to price in substantial long-term AI growth despite ongoing losses. Five9, by comparison, trades at just 1.33X forward sales despite generating positive earnings and cash flows.
SOUN vs FIVN Valuation (P/S F12M)
Image Source: Zacks Investment Research
Peer valuations reinforce this contrast. Cisco Systems trades at 6.65X forward sales, reflecting confidence in its expanding AI portfolio, while NICE trades at 1.57X. Five9 therefore trades at a discount to both Cisco and NICE despite improving profitability and expanding AI capabilities, whereas SoundHound remains the most expensive stock in the group, leaving relatively little room for execution disappointments.
Estimate Trends Favor Five9
Analysts' earnings expectations further separate the two companies. For SoundHound, the Zacks Consensus Estimate for 2026 remains unchanged over the past 60 days at a loss of 15 cents per share, wider than last year's reported loss of 13 cents. Revenues are still projected to increase 38% in 2026, followed by another 15.8% growth in 2027, underscoring robust top-line momentum despite continuing losses.
SOUN Estimate
Image Source: Zacks Investment Research
Five9 presents a more balanced outlook. The Zacks Consensus Estimate for 2026 earnings has remained unchanged at $3.26 per share over the past 60 days, while the 2027 estimate has increased to $3.79 from $3.77. Analysts expect 2026 revenue growth of 9.7%, followed by another 10.1% increase in 2027, while earnings are projected to grow 10.1% in 2026 and 16.2% in 2027. These revisions point to improving profitability supported by disciplined execution.
FIVN Estimate
Image Source: Zacks Investment Research
Which Stock Offers Better Growth?
Both companies are positioned to benefit from rising enterprise adoption of conversational AI, but they appeal to different investor profiles. SoundHound offers the more aggressive growth story. Its rapidly expanding enterprise pipeline, proprietary OASYS platform and pending LivePerson acquisition could substantially expand its addressable market over the next several years. However, the company still faces meaningful execution, integration and profitability risks.
Five9 offers a more balanced investment proposition. The company combines consistent recurring revenue, improving margins, healthy cash generation, disciplined capital allocation and expanding AI capabilities at an attractive valuation. Its improving earnings outlook further strengthens the investment case.
Since both stocks currently carry a Zacks Rank #3 (Hold), Five9 appears to offer the better growth opportunity today. While SoundHound could ultimately generate stronger long-term revenue growth, Five9's combination of profitable expansion, valuation support, stronger share price momentum and improving earnings visibility provides a more compelling risk-reward profile for investors seeking exposure to the customer AI market.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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