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Details	Date	Content	Source	Relevance
	Saved 2026-07-28 15:27 3h ago Published 2026-07-28 11:10 8h ago	Síťový sektor je krátkodobě pod tlakem kvůli slabým výdajům a clům Síťový sektor čelí krátkodobému tlaku kvůli slabým IT výdajům, clům a konkurenci, ale dlouhodobě má těžit z AI, cloudu a Wi‑Fi 7. EXTR Extreme Networks	FMP Stock News	78
Original source text 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 (CSCO - Free Report) , Extreme Networks (EXTR - Free Report) and Digi International (DGII - Free Report) . 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. One-Year Price Performance 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, as the charts below show. Forward 12-Month P/E Ratio 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 see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Price & Consensus: CSCO 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. Price & Consensus: EXTR 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. Price & Consensus: DGII

Original source text

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 (CSCO - Free Report) , Extreme Networks (EXTR - Free Report) and Digi International (DGII - Free Report) .

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.

One-Year Price Performance

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, as the charts below show.

Forward 12-Month P/E Ratio

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 see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Price & Consensus: CSCO

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.

Price & Consensus: EXTR

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.

Price & Consensus: DGII

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