Cisco, a maker of network services, video conferencing tools and security software, exceeded Wall Street’s expectations in quarterly performance and prospects and announced a new chief financial officer.
The company reported net income of US$2.17 billion in the first quarter, or 51 cents per share, compared with US$2.93 billion in the same period last year, or 68 cents per share. Adjusted earnings per share were 76 cents, compared with 84 cents in the same period last year.
Revenue fell from $13.16 billion in the same period last year to $11.93 billion. This is the fourth consecutive quarter that Cisco reported a year-on-year decline in revenue. Safe sales can help make up for the lack of infrastructure sales.
Analysts surveyed by FactSet expect on average its quarterly earnings of 70 cents per share and revenue of 11.85 billion US dollars. Cisco had previously expected earnings of 69 cents to 71 cents per share and revenue of 11.71 billion US dollars to 11.97 billion US dollars.
The stock price rose by 8% after the market, and if the stock’s market value at the opening on Friday remains unchanged, the market value will increase by approximately $13 billion. The company’s stock price fell 1.7% in regular trading to close at $38.67, with a market value of $163.23 billion.
In the first quarter, infrastructure sales fell 16% to 6.34 billion US dollars, and application software sales fell 8% to 1.38 billion US dollars, but security sales increased 6% from the same period last year to 861 million US dollars. Analysts had previously predicted that infrastructure sales were 6.45 billion US dollars, application sales were 1.4 billion US dollars, and security sales were 855.8 million US dollars.
In the analyst conference call, Cisco chairman and CEO Chuck Robbins (Chuck Robbins) sounded more optimistic than the conference call three months ago.
“When we had the last earnings conference call, we actually saw good demand in the first few weeks of the quarter, but obviously it was a few weeks, so nothing can make us trend, but the quarter started Yes, it remains linear, very linear.” Robbins told the analyst.
Cisco expects a profit of 74 to 76 cents per share in the second quarter, and revenue will be between 11.36 billion and 12.01 billion US dollars. On average, analysts expect the company to earn 73 cents per share on revenue of $11.6 billion in the quarter.
Cisco also appointed R. Scott Herren as the new CFO, effective December 18.
“Recently, Scott served as the chief financial officer of Autodesk ADSK.
He brought an incredible software background and helped lead Autodesk’s successful business model transition from perpetual license to SaaS and subscription software. “Robbins said on the phone.
Cisco announced in its latest earnings report that CFO Kelly Kramer will retire after the company is replaced and will cut costs by $1 billion in the next few quarters.
Cisco reported $602 million in “restructuring and other expenses” in the first fiscal quarter and said it expects to report another $298 million in the second quarter. Cisco did not comment on how many of the 77,500 employees in its final report were affected by the layoffs.
During the year, Cisco’s stock price fell by about 20%, while the Dow Jones Industrial Average DJIA rose by 1.9%.
The S&P 500 index SPX rose 9%, of which Cisco is part of it.
And the high-tech Nasdaq Composite Index COMP rose 30%,