Squawk on the Street Cramer's Morning Take: Cisco Systems 5/15/25
May 15, 2025
Cramer praises Cisco’s CEO for outstanding leadership in a challenging market. Recent shifts in retail sales and PPI reports are examined for their potential impact on interest rates. The podcast highlights Cisco's impressive growth against a backdrop of market fatigue. Additionally, Walmart's earnings are discussed, showcasing their effects on enterprise spending. Lastly, the power dynamics of retail pricing come into focus, illustrating how major retailers negotiate with suppliers while smaller competitors adapt with private label offerings.
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Cisco's Strong Market Position
- Cisco had its best quarter in years with strong future business prospects, especially in the Gulf region.
- The company is taking significant market share from competitors like Arista (ANET), supported by partnerships with NVIDIA.
AI Drives Cisco's Growth
- Cisco's AI infrastructure orders hit $1 billion a year early, reflecting accelerating AI demand.
- This trend aligns with growing enterprise spending on AI technologies.
Retail Scale Wins Over Tariffs
- Retailers with the biggest balance sheets, like Walmart and Costco, win when tariff-related price hikes occur.
- They leverage scale to negotiate prices and shift suppliers or go private label effectively.