Cisco (CSCO.US) teamed up with ultra-micro computers (SMCI.US) to expand the “Nvidia AI factory” solution and increase the AI computing infrastructure layout

The Zhitong Finance App learned that Cisco (CSCO.US) announced on Tuesday that it will cooperate with Ultra Micro Computer (SMCI.US) to expand its “Secure AI Factory” solution based on Nvidia (NVDA.US) and add high-density liquid-cooled and air-cooled computing systems. This means that Cisco is further expanding from traditional network devices to AI computing power infrastructure to meet the ever-increasing demand for AI deployment.

According to the plan, Cisco will include rack-scale, high-density GPU servers for ultra-microcomputers into its AI infrastructure product portfolio, and package its network, security, and observability products as pre-verification systems to help customers deploy and manage large-scale GPU clusters more easily while taking into account non-AI workloads. The new solution will support Nvidia's next-generation platforms, including NVIDIA Vera Rubin NVL72 and NVIDIA HGX Rubin NVL8, and is expected to be delivered to customers starting in October 2026.

The collaboration also covers liquid cooling solutions from the rack to the exchange structure. Cisco will combine its liquid-cooled AI network equipment with ultra-microcomputer liquid-cooled servers to support scenarios such as trillion parameter model training and high throughput inference. Cisco President and Chief Product Officer Jeetu Patel (Jeetu Patel) said that Cisco's position is “critical infrastructure in the AI era” and will support various architectural choices.

Patel emphasized that regardless of whether customers use cutting-edge models provided by hyperscale cloud vendors, open source weight models, or choose to deploy AI locally or run AI on the end side, Cisco can provide the corresponding infrastructure. “We really don't have any bias,” he said.

Judging from market performance, Cisco is being viewed by investors as one of the beneficiaries of this physical AI construction cycle. The company basically avoided the “SaaS end” (SaaSPocalypse) market, which hit software stocks hard this year, and its stock price has risen nearly 45% since this year. This is partly due to the company's focus on the hardware business — although Patel emphasized, hardware and software empower and promote each other.

After the news was announced, the stock prices of Cisco and Ultramicrocomputer both increased by about 2%.

However, this expansion has also brought Cisco further into a more competitive market, and its partners have competitive relationships with some customers — including other hyperscale cloud vendors and even Nvidia itself — in some areas. Patel downplayed this tense situation, saying that the two sides are competing in a relatively limited scope of business, and there is more room for complementarity.