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Cisco Stock Rises on Higher Revenue, Higher Guidance

by SuperiorInvest

Key takeaways

  • Cisco Systems reported better-than-expected revenue in its third-quarter earnings announcement Wednesday after the bell.
  • The company also raised its full-year revenue guidance.
  • Shares of the technology company rose in extended trading following the announcement.

Shares of Cisco Systems (CSCO) rose more than 4% in extended trading Wednesday after the company reported third-quarter revenue surpassed analyst expectations and raised its full-year guidance.

Cisco's revenue for the fourth quarter of fiscal 2024 was $12.7 billion, down 13% year over year but larger than analysts anticipated, according to estimates compiled by Visible Alpha. Net income came to $1.88 billion, or 46 cents per share, down from $3.21 billion, or 78 cents per share, in the same quarter a year earlier, and below expectations. However, adjusted earnings per share excluding one-time items came in at 88 cents, beating expectations, although that figure also represented a decline from the prior-year period.

Cisco noted that it completed the acquisition of Splunk, a provider of enterprise data infrastructure solutions, during the quarter, which had a positive impact on Cisco's revenue but negatively affected its profits. “The addition of Splunk to our product line will be a catalyst for further growth,” said Cisco CFO Scott Herren.

Third quarter of fiscal year 2024 Analyst Estimates for Q3 FY2024 Third quarter of fiscal year 2023
Revenue 12.7 billion dollars $12.54 billion $14.57 billion
Diluted earnings per share 46 cents 59 cents 78 cents
Net income 1.88 billion dollars 2.4 billion dollars $3.21 billion

The company raised its full-year revenue guidance to between $53.6 billion and $53.8 billion, up from the $51.5 billion to $52.5 billion range it issued in the second quarter and up from $53.24 billion. dollars projected by analysts.

“We delivered strong performance in the third quarter in what continues to be a dynamic environment,” said Cisco CEO Chuck Robbins, adding that the company's “unique ability to combine networking, security, observability and data allows Cisco offer our customers unparalleled digital resilience for the AI ​​Age.”

Cisco shares rose 4.3% to $51.80 in extended trading as of 5:40 p.m. ET Wednesday following the release.

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