Cisco System Inc. earnings miss estimates, disappointing revenue

Cisco Systems Inc. (NASDAQ: CSCO), a networking giant and Dow component has seen its stock rise 43.4 percent in the last year, with a year-to-date gain of about 33 percent. They published their earnings call aftermarket on Wednesday. 

  • Revenue: $12.9 billion
  • EPS: GAAP EPS is $0.70
  • Net Income: $3.0 billion
Earning Highlights
  • Overall performance: $12.9 billion in revenue, up 8% year over year, with broad-based strength across the business; GAAP EPS $0.70, up 37% year over year, and Non-GAAP EPS $0.82, up 8% year over year
  • Strong demand across the business with 33% year-over-year total product order growth
  • Solid progress on business model transformation: Total Annualized Recurring Revenue was $21.6 billion for the first quarter of fiscal 2022, up 10% year over year
CEOs Statement

“In Q1, we had robust growth and continued strong demand despite the very dynamic supply environment,” said Chuck Robbins, Chair and CEO of Cisco. “Cisco’s technology sits at the heart of the accelerated digital transformation happening today. Our breakthrough innovation, strong demand, and the success of our business transformation position us well for another year of growth in fiscal 2022.”

Analysts Estimate

EPS- $0.80 per share

Revenue- $12.98 billion

Earnings History

Cisco released its FY2021 Q4 earnings call on 18th August 2021. They delivered robust revenue growth of 8% year over year and generated over $4 billion in software revenue in Q4, an increase of 6% year over year. Within that, subscription revenue grew 9% in Q4, and software represented 31% of their business in Q4. The reported EPS for the same quarter was $0.71, a 15% year-over-year change. Operating expenses incurred by Cisco Systems for Q4 were $4,769 million and secured a GAAP gross margin of 63.6%.

Annual Forecasts

For the full fiscal year, analysts currently expect an EPS of $3.43 per share, up 6.5%, and revenue of $52.83 billion, up about 6.1%. For the fiscal year 2022, Cisco’s share price to earnings multiple is 16.7. The multiple to expected EPS of $3.69 for fiscal 2023 is 15.5, and 14.6 times the estimated EPS of $3.93 for fiscal 2024. The 52-week range for the stock is $40.77 to $60.27.

Latest Developments

On Monday, Jupiter One and Cisco announced the expansion of their cloud security and security operations relationship, which would provide enterprises with a variety of cybersecurity services.

It demonstrated a new service dubbed Webex Hologram at its WebexOne customer conference, which allows virtual meetings in augmented reality with participants depicted as photorealistic holograms rather than cartoon-like avatars.

Company Profile

Cisco Systems, Inc. is a multinational technology company based in the United States. It develops, manufactures, and distributes networking hardware, software, telecommunications equipment, and other high-tech services and products.

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