| From: Eric | 2/25/2020 1:19:22 PM | | | | | | UPDATE: Cisco unleashes 'Thanos' in hopes for a 'radical simplification' of security software
8:35 AM ET 2/25/20 | MarketWatch
| Related Quotes | | |  | | 1:15 PM ET 2/25/20 | | Symbol | Last | % Chg |
CSCO
| 42.60 | -3.18% | | Real time quote. | | |
UPDATE: Cisco unleashes 'Thanos' in hopes for a 'radical simplification' of security software
By Wallace Witkowski, MarketWatch
SecureX platform, code-named after Marvel villain, combines disparate security products from Cisco and competitors into a single interface
Cisco Systems Inc. is hoping to restore order into a universe of frazzled security professionals through a "radical simplification" that could reduce the number of hungry mouths in a crowded marketplace.
Sound familiar? Well, Cisco (CSCO) did internally code-name the product "Thanos," after the Marvel supervillain who believes he will bring order to a resource-taxed universe by randomly killing half its inhabitants. By launch on Monday, the first day of the 2020 RSA Conference for the cybersecurity industry in San Francisco, Cisco had renamed the product SecureX.
In a statement, Cisco said the product "was code-named to demonstrate similar abilities/powers -- strength and speed that SecureX can offer to customers."
Evil connotations aside, the culling spirit of Thanos plays well into what chief information security officers have long been demanding from their products: Ways of simplifying their information-security needs with scarce resources. Cisco said the SecureX platform is a single, cloud-native interface that brings together threat visibility from all Cisco products as well as third-party products in less than 15 minutes.
"The industry has been flooded with thousands of point products that were meant to help customers but instead created unmanageable environments with products that don't work together, which has created gaps in businesses' security posture," Gee Rittenhouse, the head of Cisco's security business, said in a statement.
See also: Security software seen as a fractured industry in need of consolidation marketwatch.com
Cisco's pitch is that SecureX is the scalable platform that can simplify the security environment in which companies currently patch together products from up to dozens of vendors. Of course, Cisco -- believed to be the largest single security vendor in terms of revenue after years of costly acquisitions -- would like to replace many of those products with its own. Cisco said SecureX will be available in June.
"Nearly one-third (31%) of organizations base cybersecurity monitoring and protection on more than 50 different security products," said Jon Oltsik, senior principal analyst at the Enterprise Strategy Group, in a statement. "This not only adds cost and complexity but also makes it harder to detect and respond to cybersecurity incidents in a timely fashion."
Cisco and its competitors will gather in San Francisco this week for RSA, which runs through Friday. Verizon Communications Inc. (VZ) , AT&T Inc. (T) and International Business Machines Corp. (IBM) have canceled their plans for RSA due to COVID-19 fears, but conference organizers said in an update Friday (https://www.rsaconference.com/novel-coronavirus-update)that they still expect more than 40,000 attendees.
For more: Will the shows go on? Coronavirus hangs over tech conferences marketwatch.com
Over the past 12 months, Cisco shares have declined nearly 8%, while the ETFMG Prime Cyber Security ETF (HACK) has advanced more than 11%. In comparison, the Dow Jones Industrial Average , of which Cisco is a component, has risen 12%, the S&P 500 Index has grown 20% and the tech-heavy Nasdaq Composite Index has advanced 28%. |
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| From: Eric | 5/13/2020 4:08:32 PM | | | | | | Cisco Reports Third Quarter Earnings
4:05 PM ET 5/13/20 | PR Newswire
| Related Quotes | | |  | | 4:00 PM ET 5/13/20 | | Symbol | Last | % Chg |
CSCO
| 41.95 | -2.94% | | Real time quote. | | |
-- Q3 Results:
-- Revenue: $12.0 billion
-- Decrease of (8)% year over year
-- Earnings per Share: GAAP: $0.65; Non-GAAP: $0.79
-- GAAP EPS decreased (6)% year over year
-- Non-GAAP EPS increased 1% year over year
-- Q4 Guidance:
-- Revenue: (8.5)% to (11.5)% decline year over year
-- Earnings per Share: GAAP: $0.57 to $0.62; Non-GAAP: $0.72 to $0.74
SAN JOSE, Calif., May 13, 2020 /PRNewswire/ -- Cisco today reported third quarter results for the period ended April 25, 2020. Cisco reported third quarter revenue of $12.0 billion, net income on a generally accepted accounting principles (GAAP) basis of $2.8 billion or $0.65 per share, and non-GAAP net income of $3.4 billion or $0.79 per share.
"During this extraordinary time, our priority has been supporting our employees, customers, partners and communities, while positioning Cisco for the future," said Chuck Robbins, chairman and CEO of Cisco. "The pandemic has driven organizations across the globe to digitize their operations and support remote workforces at a faster speed and greater scale than ever before. We remain focused on providing the technology and solutions our customers need to accelerate their digital organizations."
GAAP Results
Q3 FY 2020 Q3 FY 2019 Vs. Q3 FY 2019
Revenue $ 12.0 billion $ 13.0 billion (8)%
Net Income $ 2.8 billion $ 3.0 billion (9)%
Diluted Earnings
per Share
(EPS) $ 0.65 $ 0.69 (6)%
Non-GAAP Results
Q3 FY 2020 Q3 FY 2019 Vs. Q3 FY 2019
Net Income $ 3.4 billion $ 3.5 billion (2)%
EPS $ 0.79 $ 0.78 1%
Reconciliations between net income, EPS, and other measures on a GAAP and non-GAAP basis are provided in the tables located in the section entitled "Reconciliations of GAAP to non-GAAP Measures."
"We executed well in Q3 in a very challenging environment, delivering strong margins and non-GAAP EPS growth," said Kelly Kramer, CFO of Cisco. "The resiliency that we have been building into our business model is paying off, with software subscriptions now at 74% of our software revenue, up 9 points year over year. We are focused on driving long-term profitable growth while delivering shareholder value."
COVID-19 Pandemic Response
We have been focused on helping our employees, customers, partners and communities.
Employees
-- 95% of our global workforce working from home.
-- Seamless transition to work from home with a long-standing flexible work
policy, and we build the technologies that allow organizations to stay
connected, secure and productive.
-- For the 5% who must be in the office to perform their roles, we are
focused on their health and safety, and are taking all of the necessary
precautions.
Customer and Partners
-- Introduced a variety of free offers and trials for our Webex and security
technologies as they dramatically shifted entire workforces to be remote.
-- Announced $2.5 billion in financing with a new Business Resiliency
Program through Cisco Capital to offer financial flexibility and support
their business continuity. This will help customers and partners access
the technology they need now, invest for recovery, and defer most of the
payments until early 2021.
Communities
-- Committed nearly $300 million to date to support both global and local
pandemic response efforts.
-- Providing technology and financial support for non-profits, first
responders, and governments.
-- Donating personal protective equipment to hospital workers including N95
masks and face shields 3D-printed by Cisco volunteers around the world.
Financial Summary
All comparative percentages are on a year-over-year basis unless otherwise noted.
Q3 FY 2020 Highlights
Revenue -- Total revenue was $12.0 billion, down 8%, with product revenue down 12% and service revenue up 5%. Revenue by geographic segment was: Americas down 8%, EMEA down 7%, and APJC down 9%. Product revenue was led by growth in Security, up 6%. Infrastructure Platforms was down 15% and Applications was down 5%.
Gross Margin -- On a GAAP basis, total gross margin, product gross margin, and service gross margin were 64.9%, 63.7%, and 67.7%, respectively, as compared with 63.1%, 62.0%, and 66.3%, respectively, in the third quarter of fiscal 2019.
On a non-GAAP basis, total gross margin, product gross margin, and service gross margin were 66.6%, 65.8%, and 68.9%, respectively, as compared with 64.6%, 63.7%, and 67.3%, respectively, in the third quarter of fiscal 2019.
Total gross margins by geographic segment were: 67.8% for the Americas, 65.7% for EMEA and 63.5% for APJC.
Operating Expenses -- On a GAAP basis, operating expenses were $4.4 billion, down 6%, and were 36.4% of revenue. Non-GAAP operating expenses were $3.8 billion, down 9%, and were 31.8% of revenue.
Operating Income -- GAAP operating income was $3.4 billion, down 3%, with GAAP operating margin of 28.5%. Non-GAAP operating income was flat at $4.2 billion, with non-GAAP operating margin at 34.9%.
Provision for Income Taxes -- The GAAP tax provision rate was 19.4%. The non-GAAP tax provision rate was 20.0%.
Net Income and EPS -- On a GAAP basis, net income was $2.8 billion, a decrease of 9%, and EPS was $0.65, a decrease of 6%. On a non-GAAP basis, net income was $3.4 billion, a decrease of 2%, and EPS was $0.79, an increase of 1%.
Cash Flow from Operating Activities -- $4.2 billion for the third quarter of fiscal 2020, a decrease of 2% compared with $4.3 billion for the third quarter of fiscal 2019.
Balance Sheet and Other Financial Highlights
Cash and Cash Equivalents and Investments -- $28.6 billion at the end of the third quarter of fiscal 2020, compared with $33.4 billion at the end of fiscal 2019.
Deferred Revenue -- $18.6 billion, up 7% in total, with deferred product revenue up 17%. Deferred service revenue was up 1%.
Remaining Performance Obligations -- $25.5 billion at the end of the third quarter of fiscal 2020, up 11%.
Capital Allocation -- In the third quarter of fiscal 2020, we returned $2.5 billion to shareholders through share buybacks and dividends. We declared and paid a cash dividend of $0.36 per common share, or $1.5 billion, and repurchased approximately 25 million shares of common stock under our stock repurchase program at an average price of $39.71 per share for an aggregate purchase price of $981 million. The remaining authorized amount for stock repurchases under the program is $10.8 billion with no termination date.
Acquisitions
In the third quarter of fiscal 2020, we closed the acquisition of Exablaze, a privately held designer and manufacturer of advanced network devices aimed at reducing latency and improving network performance.
Guidance for Q4 FY 2020
Cisco expects to achieve the following results for the fourth quarter of fiscal 2020:
Q4 FY 2020
Revenue (8.5)% - (11.5)% decline Y/Y
Non-GAAP gross margin rate 64% - 65%
Non-GAAP operating margin rate 31.5% - 32.5%
Non-GAAP tax provision rate 20%
Non-GAAP EPS $0.72 - $0.74
Cisco estimates that GAAP EPS will be $0.57 to $0.62 in the fourth quarter of fiscal 2020.
A reconciliation between the Guidance for Q4 FY 2020 on a GAAP and non-GAAP basis is provided in the table entitled "GAAP to non-GAAP Guidance for Q4 FY 2020" located in the section entitled "Reconciliations of GAAP to non-GAAP Measures."
Editor's Notes:
-- Q3 fiscal year 2020 conference call to discuss Cisco's results along with
its guidance will be held on Wednesday, May 13, 2020 at 1:30 p.m. Pacific
Time. Conference call number is 1-888-848-6507 (United States) or
1-212-519-0847 (international).
-- Conference call replay will be available from 4:00 p.m. Pacific Time, May
13, 2020 to 4:00 p.m. Pacific Time, May 20, 2020 at 1-800-391-9847
(United States) or 1-402-220-3093 (international). The replay will also
be available via webcast on the Cisco Investor Relations website at
investor.cisco.com.
-- Additional information regarding Cisco's financials, as well as a webcast
of the conference call with visuals designed to guide participants
through the call, will be available at 1:30 p.m. Pacific Time, May 13,
2020. Text of the conference call's prepared remarks will be available
within 24 hours of completion of the call. The webcast will include both
the prepared remarks and the question-and-answer session. This
information, along with the GAAP to non-GAAP reconciliation information,
will be available on the Cisco Investor Relations website at
investor.cisco.com.
CISCO SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per-share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
April 25, April 27, April 25, April 27,
2020 2019 2020 2019
REVENUE:
Product $ 8,597 $ 9,722 $ 27,146 $ 28,885
Service 3,386 3,236 10,001 9,591
Total revenue 11,983 12,958 37,147 38,476
COST OF SALES:
Product 3,120 3,693 9,770 11,106
Service 1,092 1,092 3,378 3,278
Total cost of
sales 4,212 4,785 13,148 14,384
GROSS MARGIN 7,771 8,173 23,999 24,092
OPERATING
EXPENSES:
Research and
development 1,546 1,659 4,782 4,824
Sales and
marketing 2,192 2,403 6,951 7,084
General and
administrative 457 541 1,431 1,261
Amortization of
purchased
intangible
assets 34 39 108 112 |
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| From: Eric | 5/13/2020 4:34:04 PM | | | | | | UPDATE: Cisco stock heads higher as profit continues to flow amid pandemic despite revenue slowdown
4:31 PM ET 5/13/20 | MarketWatch
| Related Quotes | | |  | | 4:00 PM ET 5/13/20 | | Symbol | Last | % Chg |
CSCO
| 41.95 | -2.94% | | Real time quote. | | |
By Jeremy C. Owens, MarketWatch , Jon Swartz
Earnings increase from last year despite sales decline; forecast for fiscal fourth quarter shows higher profit expectation than analysts
Cisco Systems Inc. showed stronger-than-expected resilience in its earnings Wednesday and shares went higher in after-hours trading, but the tech giant's sales are declining amid the COVID-19 pandemic.
The maker of network services, videoconferencing tools and security software reported third-quarter net income of $2.8 billion, or 65 cents a share, as revenue declined 8% to $12 billion from $12.96 billion in the year-ago period. After adjusting for stock compensation and other effects, Cisco reported earnings of 79 cents a share, up slightly from 78 cents a share a year ago.
Analysts surveyed by FactSet had projected adjusted earnings of 71 cents a share on revenue of $11.9 billion on average, though those expectations have come down significantly since COVID-19 began to spread across the globe. Analysts expected adjusted earnings of 80 cents a share on sales of $12.7 billion at the end of 2019.
The third-quarter results, announced after the market's close Wednesday, initially sent Cisco (CSCO) shares up 3% in after-hours trading. Cisco stock has dipped 20% the past 12 months, while the S&P 500 index has inched down 1%. Since March 12, however, Cisco shares have jumped 30%.
"The pandemic has driven organizations across the globe to digitize their operations and support remote workforces at a faster speed and greater scale than ever before. We remain focused on providing the technology and solutions our customers need to accelerate their digital organizations," Cisco Chief Executive Chuck Robbins said in a statement investor.cisco.com announcing the results.
See also: Cisco is seeing a spike in videoconferencing, but how will IT spending fare in the age of COVID-19? marketwatch.com
As a major provider of networking equipment, Cisco is a crucial barometer of demand for information technology by major corporations. The results underscore softness in overall IT spending in the age of COVID-19 despite insatiable demand for certain aspects -- namely videoconferencing and network infrastructure.
For the fiscal fourth quarter, Cisco expects revenue decreases to accelerate, guiding for a year-over-year sales decline of 8.5% to 11.5% after hitting more than $13 billion in revenue in the year-ago quarter, suggesting that sales will come in lower than $12 billion. Analysts on average expected fourth-quarter revenue of $12.07 billion, after shaving off more than $750 million in response to COVID-19.
LIke its big profit beat on Wednesday, however, Cisco continues to exceed expectations with its earnings forecast. For the fourth quarter, the company expects adjusted earnings of 72 to 74 cents a share, topping the average analyst expectation of 71 cents a share, according to FactSet. |
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| From: Eric | 7/9/2020 1:30:49 PM | | | | | | Cisco's Stock Rises After Morgan Stanley Turns Bullish, Citing Durable Earnings Growth And Valuation -- MarketWatch
11:48 AM ET 7/9/20
| Related Quotes | | |  | | 1:27 PM ET 7/9/20 | | Symbol | Last | % Chg |
CSCO
| 47.05 | 2.70% | | Real time quote. | | |
Shares of Cisco Systems Inc. (CSCO) rallied 1.1% in midday trading Thursday, to buck the broad-market selloff, after Morgan Stanley analyst Meta Marshall turned bullish on the networking giant, citing attractive valuation, durable earnings growth and potential tailwinds. The stock was the best performer of the two of 30 Dow Jones Industrial Average components that were gaining ground, as the Dow tumbled 494 points, or 1.9%. Marshall raised the rating to overweight, after being at equal weight since February 2019, and boosted his price target on the stock to $54 from $46. Marshall said Cisco's valuation multiple is at the greatest discount to the S&P 500 in the past 10 years. He believes the "valuation gap" will normalize as Cisco's earnings prove more resilient than investor expectations, driven by strength in public sector and service provider revenue, and as business spending improves as networking and security needs grow. "We are mindful of secular headwinds and broad macro exposure, but think growing networking/security needs, cash flow flexibility and [operating expenditure] discipline provide tailwinds, helping multiple gap close over [the next 12 months]," Marshall wrote in a note to clients. The stock has lost 3.5% year to date, while the Dow has dropped 10.4% and the S&P 500 has eased 3.4%.
-Tomi Kilgore
For more from MarketWatch: marketwatch.com |
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| From: Eric | 11/12/2020 4:12:30 PM | | | | | | Cisco Reports First Quarter Earnings
4:05 PM ET 11/12/20 | PR Newswire
| Related Quotes | | |  | | 4:00 PM ET 11/12/20 | | Symbol | Last | % Chg |
CSCO
| 38.67 | -1.68% | | Real time quote. | | |
-- Q1 Results:
-- Revenue: $11.9 billion
-- Decrease of (9)% year over year
-- Earnings per Share: GAAP: $0.51; Non-GAAP: $0.76
-- GAAP EPS decreased (25)% year over year
-- Non-GAAP EPS decreased (10)% year over year
-- Q2 Guidance:
-- Revenue: 0% to (2)% decline year over year
-- Earnings per Share: GAAP: $0.55 to $0.60; Non-GAAP: $0.74 to $0.76
SAN JOSE, Calif., Nov. 12, 2020 /PRNewswire/ -- Cisco today reported first quarter results for the period ended October 24, 2020. Cisco reported first quarter revenue of $11.9 billion, net income on a generally accepted accounting principles (GAAP) basis of $2.2 billion or $0.51 per share, and non-GAAP net income of $3.2 billion or $0.76 per share.
"Cisco is off to a solid start in fiscal 2021 and we are encouraged by the signs of improvement in our business as we continue to navigate the pandemic and other macro uncertainties," said Chuck Robbins, chairman and CEO of Cisco. "Our focus is on winning with a differentiated innovative portfolio, long-term growth and being a trusted technology partner offering choice and flexibility to our customers. We see many great opportunities ahead as every company in every industry is accelerating its digital-first strategy."
GAAP Results
Q1 FY 2021 Q1 FY 2020 Vs. Q1 FY 2020
Revenue $11.9 billion $13.2 billion (9)%
Net Income $2.2 billion $2.9 billion (26)%
Diluted Earnings
per Share
(EPS) $0.51 $0.68 (25)%
Non-GAAP Results
Q1 FY 2021 Q1 FY 2020 Vs. Q1 FY 2020
Net Income $3.2 billion $3.6 billion (11)%
EPS $0.76 $0.84 (10)%
Reconciliations between net income, EPS, and other measures on a GAAP and non-GAAP basis are provided in the tables located in the section entitled "Reconciliations of GAAP to non-GAAP Measures."
"Our Q1 results reflect good execution with strong margins in a challenging environment," said Kelly Kramer, CFO of Cisco. "We continued to transform our business through more software offerings and subscriptions, driving 10% year over year growth in remaining performance obligations. We delivered strong growth in operating cash flow and returned $2.3 billion to shareholders."
Financial Summary
All comparative percentages are on a year-over-year basis unless otherwise noted.
Q1 FY 2021 Highlights
Revenue -- Total revenue was $11.9 billion, down 9%, with product revenue down 13% and service revenue up 2%. Revenue by geographic segment was: Americas down 10%, EMEA down 10%, and APJC down 7%. Product revenue was led by growth in Security, up 6%. Infrastructure Platforms was down 16% and Applications was down 8%.
Gross Margin -- On a GAAP basis, total gross margin, product gross margin, and service gross margin were 63.6%, 62.7%, and 65.8%, respectively, as compared with 64.3% for each in the first quarter of fiscal 2020.
On a non-GAAP basis, total gross margin, product gross margin, and service gross margin were 65.8%, 65.3%, and 67.1%, respectively, as compared with 65.9%, 66.1%, and 65.4%, respectively, in the first quarter of fiscal 2020.
Total gross margins by geographic segment were: 67.3% for the Americas, 63.9% for EMEA and 63.0% for APJC.
Operating Expenses -- On a GAAP basis, operating expenses were $5.0 billion, up 3%, and were 42.0% of revenue. Non-GAAP operating expenses were $4.0 billion, down 7%, and were 33.1% of revenue.
Operating Income -- GAAP operating income was $2.6 billion, down 28%, with GAAP operating margin of 21.5%. Non-GAAP operating income was $3.9 billion, down 12%, with non-GAAP operating margin at 32.7%.
Provision for Income Taxes -- The GAAP tax provision rate was 18.9%. The non-GAAP tax provision rate was 19.0%.
Net Income and EPS -- On a GAAP basis, net income was $2.2 billion, a decrease of 26%, and EPS was $0.51, a decrease of 25%. On a non-GAAP basis, net income was $3.2 billion, a decrease of 11%, and EPS was $0.76, a decrease of 10%.
Cash Flow from Operating Activities -- $4.1 billion for the first quarter of fiscal 2021, an increase of 14% compared with $3.6 billion for the first quarter of fiscal 2020.
Balance Sheet and Other Financial Highlights
Cash and Cash Equivalents and Investments -- $30.0 billion at the end of the first quarter of fiscal 2021, compared with $29.4 billion at the end of fiscal 2020.
Deferred Revenue -- $20.5 billion, up 10% in total, with deferred product revenue up 15%. Deferred service revenue was up 7%.
Remaining Performance Obligations -- $27.5 billion at the end of the first quarter of fiscal 2021, up 10%.
Capital Allocation -- In the first quarter of fiscal 2021, we returned $2.3 billion to shareholders through share buybacks and dividends. We declared and paid a cash dividend of $0.36 per common share, or $1.5 billion, and repurchased approximately 20 million shares of common stock under our stock repurchase program at an average price of $40.44 per share for an aggregate purchase price of $800 million. The remaining authorized amount for stock repurchases under the program is $10.0 billion with no termination date.
Guidance for Q2 FY 2021
Cisco expects to achieve the following results for the second quarter of fiscal 2021:
Q2 FY 2021
-------------------------------
Revenue 0% - (2)% decline Y/Y
Non-GAAP gross margin rate 64% - 65%
Non-GAAP operating margin rate 32% - 33%
Non-GAAP tax provision rate 19%
Non-GAAP EPS $0.74 - $0.76
Cisco estimates that GAAP EPS will be $0.55 to $0.60 in the second quarter of fiscal 2021.
A reconciliation between the Guidance for Q2 FY 2021 on a GAAP and non-GAAP basis is provided in the table entitled "GAAP to non-GAAP Guidance for Q2 FY 2021" located in the section entitled "Reconciliations of GAAP to non-GAAP Measures." |
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| From: Eric | 11/12/2020 6:03:48 PM | | | | | | UPDATE: Cisco stock rallies 8% as results, outlook top Street view
5:49 PM ET 11/12/20
| Related Quotes | | |  | | 4:00 PM ET 11/12/20 | | Symbol | Last | % Chg |
CSCO
| 38.67 | -1.68% | | Real time quote. | | |
By Wallace Witkowski
Autodesk's Herren named new CFO
Cisco Systems Inc. shares surged in the extended session Thursday after the maker of network services, videoconferencing tools and security software's quarterly results and outlook topped Wall Street estimates, and it announced a new chief financial officer.
Cisco (CSCO) reported fiscal first-quarter net income of $2.17 billion, or 51 cents a share, compared with $2.93 billion, or 68 cents a share, in the year-ago period. Adjusted earnings were 76 cents a share, compared with 84 cents a share in the year-ago period.
Revenue declined to $11.93 billion from $13.16 billion in the year-ago quarter, marking the fourth quarter in a row Cisco has reported a year-over-year decline in revenue. Security sales helped make up for deficiencies in infrastructure sales.
Analysts surveyed by FactSet had forecast earnings of 70 cents a share on revenue of $11.85 billion, following Cisco's forecast of 69 cents to 71 cents a share on revenue of $11.71 billion to $11.97 billion.
Shares rallied as much as 8% after hours, and will add about $13 billion in market cap if the stock performs at those levels when it opens Friday. Shares declined 1.7% in the regular session to close at $38.67, for a market cap of $163.23 billion.
For the first quarter, infrastructure sales declined 16% to $6.34 billion and applications sales fell 8% to $1.38 billion, but security sales rose 6% to $861 million from the year-ago period. Analysts had forecast infrastructure sales of $6.45 billion, applications sales of $1.4 billion and security sales of $855.8 million.
On the analyst call, Chuck Robbins, Cisco chairman and chief executive, sounded a lot more optimistic going forward than he did in the earnings call three months ago marketwatch.com.
"When we did the last earnings call, we had seen actually good demand in the first couple weeks of the quarter, but clearly it was a couple weeks and so it was not anything that would have given us a trend, but the quarter started and it stayed, it was very linear," Robbins told analysts.
Cisco expects earnings of 74 cents to 76 cents a share on revenue of $11.36 billion to $12.01 billion for the fiscal second quarter. Analysts had forecast 73 cents a share on revenue of $11.6 billion for the quarter.
Cisco also appointed R. Scott Herren as its new CFO marketwatch.com effective Dec. 18.
"Most recently Scott served as the CFO for Autodesk (ADSK) and brings an incredible background in software and helped lead Autodesk's successful business model transformation from perpetual licenses to SaaS and subscription software," Robbins said on the call.
In its last earnings report, Cisco announced that CFO Kelly Kramer will retire from the company once a replacement is found and that it would undergo a $1 billion cost reduction "over the next few quarters."
Cisco reported $602 million in "restructuring and other charges" in the fiscal first quarter, and said it expects another $298 million to be reported in the second quarter. Cisco did not comment on the call as to how many of its last-reported 77,500 employees were affected by layoffs.
For the year, Cisco shares are down about 20%, compared with a 1.9% advance in the Dow Jones Industrial Average , of which Cisco is a component, a 9% rise by the S&P 500 index and a 30% gain by the tech-heavy Nasdaq Composite Index . |
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| From: Eric | 11/13/2020 4:17:26 PM | | | | | | Cisco Stock Is Rebounding After Earnings. Why There's Still Work To Do. -- Barrons.com
3:40 PM ET 11/13/20
| Related Quotes | | |  | | 4:00 PM ET 11/13/20 | | Symbol | Last | % Chg |
CSCO
| 41.40 | 7.06% |
IBM
| 116.85 | 2.05% | | Real time quote. | | |
By Eric J. Savitz
At least for now, Cisco Systems is out of the investment doghouse.
On Thursday, the networking giant posted better-than-expected results for the fiscal first quarter ended Oct. 24 and the company's guidance for the January quarter was a little better than the Street had been anticipating. As Cisco (ticker: CSCO) CEO Chuck Robbins said in an interview with Barron's , the numbers may not have looked great mathematically, but they were "better than we thought."
Cisco posted revenue for the quarter of $11.9 billion, down 9% year over year, which was at the high end of the company's guidance range. Non-GAAP profits of 76 cents a share exceeded the company's target range of 69 to 71 cents. Cisco projects January quarter revenues will be flat to down 2%, with non-GAAP earnings per share of 74 to 76 cents. That's above the old Wall Street analyst consensus, which had called for a 3% decline in revenue, and non-GAAP profits of 73 cents a share.
To be sure, this was no return to the Cisco of old. Revenue from the core infrastructure platforms business was down 16%. Enterprise orders were down 15%, and orders from Asia were off 14%. But there were some positive signs beyond the top and bottom lines. The severe recent order declines from commercial customers -- basically small- and medium-size businesses -- moderated. Demand from cloud customers was strong. Security revenue was up 6% and public sector revenue was robust.
Add it up, and you get a quarter that pleased analysts, though some remain cautious about the sustainability of the rebound.
New Street Research analyst Pierre Ferragu on Friday upped his rating on Cisco shares to Buy from Neutral, setting a Street-high $60 price target. In a research note, Ferragu notes that the company is exposed to legacy and on-premise IT spending, "which has made 2020 a difficult year." But he says the revenue decline has troughed, with January quarter revenues likely flat sequentially and down just 1% at the midpoint of the guidance range year over year.
"This to us is the beginning of a recovery in IT spending," Ferragu writes. "In our conversations with Fortune 500 companies and industry executives, we see reasons to expect a quick recovery in 2021. In 2020, spending was front-loaded and directed toward emergency responses to Covid and work from home, which led to a very weak second half, but 2021 IT budgets are unlikely to get cut, as in-depth transformation projects have only been postponed."
Evercore ISI analyst Amit Daryananai writes that "this one goes out to all the haters ... reduced uncertainty, improving revenue trajectory, and easy compares make Cisco an attractive large-cap asset to own especially for value investors." He keeps his Outperform rating and $54 target.
Barclays analyst Tim Long likewise writes that "both tone and visibility has improved since last quarter, and we believe CSCO has room to run in the post-pandemic recovery." He keeps his Overweight rating and $50 target.
And RBC Capital's Robert Muller writes that "with long-duration secular tailwinds intact, steady market leading positions, and favorable valuation ... we continue to view the long-term CSCO story favorably." He keeps his Outperform rating, and inches up his target to $49, from $48.
Other analysts saw the quarter as a step in the right direction, but want to see more evidence before jumping aboard.
William Blair analyst Jason Ader keeps his Market Perform rating. "We contend that pandemic or no pandemic, Cisco's business is not yet out of the woods, with the long-term structural pressures ... remaining in place," he writes in a research note. "While Cisco has been attempting to pivot its business toward a greater mix of software and recurring revenue, we believe the pandemic has spotlighted the firm's product deficiencies (especially in the cloud), nonstrategic assets (e.g., Cisco's compute portfolio), and competitive challenges (best-of-breed competition chipping away in multiple product areas)."
Ader adds that "without a bolder approach to addressing its strategic shortcomings in a rapidly changing technology landscape, we think that like IBM (pre-Red Hat), Cisco's growth rate will continue to languish and its relevance with CIOs could continue to erode."
Needham's Alex Henderson remains a skeptic, and keeps his Hold rating. "Cisco sounded much more upbeat on the call and all we can do is assume it is in the pipeline activity," he writes. "The numbers reported don't show much cause for optimism. Cisco reported a year-over-year decline in revenues of 9% on a steep decline of 13.1% in product revenues against a decline in the year-ago period....We consider Cisco fairly valued."
Citi's Jim Suva keeps his Neutral rating, though he inches up his target to $45, from $43. "We were impressed with the company's outlook as well as a clear change in tone that went from last quarter's cautious comments of not much improvement to current quarter comments of a more stable and improving demand environment," he writes in a research note Friday. But he adds that he still has some concerns, in particular the 5% drop in overall orders, and the sharp 15% decline in enterprise orders, which deteriorated from down 7% in the July quarter. |
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| From: Eric | 2/2/2022 5:12:31 PM | | | | | | Cisco Schedules Conference Call for Q2 Fiscal Year 2022 Financial Results
4:30 PM ET 2/2/22 | Dow Jones
SAN JOSE, Calif., Feb. 2, 2022 /PRNewswire/ -- Cisco has scheduled a conference call for Wednesday, February 16, 2022, at 1:30 PM (PT); 4:30 PM (ET) to announce its second quarter fiscal year 2022 financial results for the period ending Saturday, January 29, 2022.
Financial results will be released over PR Newswire via US National and European Financial distribution, after the close of the market on Wednesday, February 16, 2022.
Cisco's quarterly earnings press release will be posted at newsroom.cisco.com.
Date:
Wednesday, February 16, 2022
Time:
1:30 PM (PT); 4:30 PM (ET)
To Listen via Telephone:
888-848-6507
212-519-0847 (for International Callers)
RSVP:
No RSVP is necessary
To Listen via the Internet:
We are pleased to offer a live and replay audio broadcast of the conference call with corresponding slides at investor.cisco.com.
Replay: A telephone playback of the Q2 FY2022 conference call is scheduled to be available beginning at 4:00 PM (PT) on February 16, 2022, through 4:00 PM (PT) February 23, 2022. The replay will be accessible by calling 888-568-0332 (International callers: 203-369-3905). The call runs 24 hours/day, including weekends. |
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