Cisco issues upbeat guidance despite 13% hit to revenue in Q3

Cisco Systems Inc (NASDAQ: CSCO) is pushing to the upside in extended hours on Wednesday after reporting market-beating financial results for its third quarter.

This is a developing story. Figures missing below will be updated as received!

Cisco stock rallies on upbeat guidance for Q4

Investors are cheering also because the management issued upbeat guidance for the future. $CSCO now forecasts its revenue to fall between $13.4 billion and $13.6 billion on up to 86 cents a share of adjusted EPS in Q4.

Analysts, in comparison, were at billion and per share, respectively. Chuck Robbins – the chief executive of Cisco Systems said in a press release today:

Our unique ability to bring together networking, security, observability, and data enables Cisco to offer our customers unrivaled digital resilience for the AI era.

The Nasdaq-listed firm saw its product revenue tank 19% in the recently concluded quarter which was partly offset by a 6.0% increase in its services revenue. Cisco stock is now up more than 10% versus its year-to-date low.  

Cisco Q3 earnings snapshot

• Earned $1.90 billion versus the year-ago $3.20 billion
• Per-share earnings also went down from 78 cents to 46 cents
• Adjusted EPS printed at 88 cents a share as per the earnings report
• Revenue declined 13% year-over-year to $12.7 billion
• Consensus was 82 cents a share on $12.53 billion in revenue
• Splunk revenue came in at $413 million for the third quarter
• Improved gross margin by 170 basis points in fiscal Q3
• Annual recurring revenue of $29.2 billion was up 22%
• Ended Q3 with $38.8 billion of remaining performance obligations

Cisco increased its quarterly dividend by % to 40 cents per share on Wednesday. According to its CFO Scott Herren:

Customers are consuming equipment shipped in line with our expectations and we are seeing stabilization of demand as a result. The addition of Splunk to our product line will be a catalyst for further growth.

This is a developing story. Check back in a few minutes for more updates!

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