Cisco Systems Inc.’s stock slipped 6% in extended trading Wednesday after the computer-networking company reported fiscal first-quarter results slightly above Wall Street estimates but offered tepid guidance.

Cisco CSCO, -0.42% reported net income of $3 billion, or 70 cents a share, compared with net income of $2.2 billion, or 51 cents a share, in the year-ago quarter. The company’s adjusted net income was $3.5 million, or 82 cents a share.

Revenue climbed 8% to $12.9 billion, from $11.9 billion a year ago. Analysts surveyed by FactSet had expected earnings of 80 cents and revenue of $12.98 billion.

“In Q1, we had robust growth and continued strong demand despite the very dynamic supply environment,” Cisco Chief Executive Chuck Robbins said in a statement announcing the results.

The company expects 64 cents to 68 cents a share in profit, or 80 cents to 82 cents on an adjusted basis, in the fiscal second quarter. Analysts were forecasting 70 cents and 82 cents, respectively, according to FactSet.

Cisco, like most major tech component suppliers, is coping with supply chain issues that have partially offset strong enterprise sales. The conflicting dynamic was at the heart of many analysts’ notes heading into Monday’s repot.

“There were so many things that went well in the quarter,” Cisco Chief Financial Officer Scott Herren told MarketWatch in a phone interview, noting a 33% jump in product order growth rate from a year ago, a 21% rise in annualized revenue run-rate, and strong demand across all sectors and geographies.

“But we couldn’t convert the demand into revenue, at least during the 90-day cycle” because of supply-chain issues that limited access to parts like semiconductors, power supplies and memory, as well as logistic snarls, he added.

“All that backlog and ARR will eventually become revenue,” Herren said.

Secure, Agile sales ($5.97 billion, up 10% year-over-year), Services revenue ($3.4 billion, up 1%), and Internet for the Future ($1.38 billion, up 46%) led in revenue categories.

The quarter marked the first time Cisco broke out product and service revenue into seven new categories: Secure, Agile Networks; Hybrid Work; End-to-End Security; Internet for the Future; Optimized Application Experiences; Other Products; and Services.

Cisco’s stock is up 27% so far in 2021, while the Dow Jones Industrial Average DJIA, -0.58%,  which counts Cisco as a component, has advanced 17%. The broader S&P 500 index SPX, -0.26% has increased 25% this year.

Source: Cisco stock drops 6% after earnings guidance disappoints

Cisco stock drops 6% after earnings guidance disappoints - Click To Share

Share on facebook
Share on twitter
Share on reddit
Share on linkedin
Share on email
Share on whatsapp

Other recent press releases

*This is a free press release. All upgraded press releases are ad-free!

Why The Dallas Cowboys Should Aim To Acquire Veteran Receiver

The Dallas Cowboys appear to be lacking depth at wide receiver entering the 2022 season. (Photo by … [+] Tom Pennington/Getty Images) Getty Images The Dallas Cowboys will enter the start of the 2022 regular season with one proven wide receiver on its roster. As the Cowboys look to carry the momentum they established during…

Pennsylvania’s Fetterman Released From Hospital After Stroke

LANCASTER, Pa.—Pennsylvania Lt. Gov. John Fetterman, the Democratic nominee in the state’s high-profile U.S. Senate contest, has been released from the hospital after a stay of more than a week following a stroke, his wife and his campaign said Sunday. Fetterman, 52, won the Democratic nomination while in the hospital, easily beating U.S. Rep. Conor…