Key Takeaways:
Cisco Systems Inc., Intel Corp., and Corning Inc., three titans of the dot-com era, have seen their stock prices surge past 24-year-old records, fueled by an investor frenzy for artificial intelligence infrastructure.
"1999 called, and it wants its networking boom back," said Amit Daryanani, an analyst at Evercore ISI. "This is a breakout print and we expect as investors appreciate the durability of growth here the stock should work higher.”
The revival has been dramatic. Cisco, which has gained over 32% year-to-date, saw its shares jump another 15% after reporting fiscal third-quarter revenue grew 12% to $15.84 billion, beating estimates. Intel surged an astonishing 200% this year to finally top its 2000 peak in April, while fiber-optic maker Corning is up more than 135% in the same period. The rally is underpinned by concrete demand, with Cisco raising its expected AI-related orders for the fiscal year to $9 billion, up from a prior $5 billion forecast.
While the rally echoes the speculative boom of the late 1990s, some analysts see key differences. The current AI buildout is largely financed by the massive cash flows of tech giants like Apple Inc. and Alphabet Inc., not just venture capital. "We think this bull market still has a way to go and expect the technology sector to lead," said Jeff Buchbinder, chief equity strategist at LPL Financial, noting that tech stock valuations are less than half of their dot-com peak.
Cisco's recent performance highlights the AI-driven shift. Alongside its strong earnings, the company announced it would cut nearly 4,000 jobs to redirect resources toward high-growth areas like AI, security, and silicon. CEO Chuck Robbins said the company has already taken $5.3 billion in AI infrastructure orders this year. The move is part of a broader trend, with tech companies slashing over 103,000 jobs in 2026 to fund AI investments.
The market has rewarded the strategic shift. Cisco's networking revenue jumped 25% to $8.82 billion, well ahead of analyst expectations. The company's forecast for the fourth quarter also significantly outpaced Wall Street's projections, with revenue expected between $16.7 billion and $16.9 billion, compared to the consensus estimate of $15.82 billion. This performance has helped power the Technology Select Sector SPDR Fund to an all-time high, underscoring the breadth of the tech rally beyond just the "Magnificent Seven" stocks.
This article is for informational purposes only and does not constitute investment advice.
