Cisco tops Morgan Stanley CIO survey despite cooling spending plans

what happened

Cisco Systems ranked as the top networking choice in a third-quarter survey of CIOs conducted by Morgan Stanley, according to Seeking Alpha. Still, most CIOs said they plan to hold back on spending. Net vendor spend intentions fell to +28% from +57%, while data center purchase intentions eased to +37% from +55%, though both remain ahead of peers.

Analyst Meta Marshall noted that campus networking held up better, with upgrade intentions rising to +36% from +33%, although Cisco retention slipped to 63% from 68%. Security is still the strongest spending category, even though its intentions weakened. Interest in Splunk improved modestly without a clear change in buying behavior. Morgan Stanley kept its Overeight rating and $135 price target on Cisco shares.

The survey also linked higher equipment prices to the slowdown, with project delays in the quarter climbing to 13% from 2%.

why it matters

The picture for markets is mixed: Cisco's strength in networking and better sentiment around Splunk support the company's business, while weaker security intentions and costlier equipment pose risks to future orders. Upcoming surveys will show whether this trend persists.

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