File photo: Cisco’s campus in Amsterdam, July 16, 2019. Ceescamel / Wikimedia Commons / CC BY-SA 4.0. Cropped and resized; adapted image licensed CC BY-SA 4.0.
Cisco raised its full-year sales and profit forecasts Thursday after quarterly revenue grew 24% to $18.5 billion, as demand for networking equipment lifted results.
In its first-quarter earnings release, the company reported net income of $4.6 billion, or $1.14 a share, for the fiscal quarter ended October 24. A year earlier, it earned $2.9 billion, or 72 cents a share.
Adjusted earnings, which exclude certain costs included in standard accounting results, rose to $1.40 a share from $1.00. Cisco said both revenue and adjusted earnings exceeded the top of its previous forecast.
Nasdaq’s quote showed Cisco at $104.88 at 4:23 p.m. Eastern, up $2.87, or 2.81%, from its $102.01 regular-session close. That was an after-hours reading, not the stock’s change during the regular trading day.
Cisco now expects fiscal 2027 revenue of $74.8 billion to $75.8 billion and adjusted earnings of $5.47 to $5.53 a share. Its forecast for earnings under generally accepted accounting principles, or GAAP, is $4.38 to $4.44 a share. Forecasts are management’s estimates, not completed sales or profits.
The company raised its expected fiscal 2027 AI infrastructure revenue from hyperscale customers to $9 billion. Those customers operate large data-center networks. Cisco supplies the equipment that connects computers and moves information between them.
Networking revenue rose 43%, compared with 7% growth in security, 8% in collaboration and 2% in observability, the tools used to monitor technology systems. Services revenue grew 1%.
The faster sales growth did not lift every measure of profitability. GAAP gross margin fell to 63.7% from 65.5%, while adjusted gross margin fell to 65.6% from 68.1%. Operating profit nevertheless rose as operating expenses fell on a GAAP basis.
For the second fiscal quarter, Cisco expects revenue of $18.0 billion to $18.2 billion, GAAP earnings of $1.07 to $1.09 a share and adjusted earnings of $1.34 to $1.36 a share.
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