Cisco stock rises as earnings, outlook top expectations
4:40 PM ET 2/13/19 | MarketWatch
| RELATED QUOTES | | |  | | 4:15 PM ET 2/13/19 | | Symbol | Last | % Chg |
CSCO
| 47.50 | -0.81% | | Real time quote. | | |
Cisco stock rises as earnings, outlook top expectations
By Wallace Witkowski, MarketWatch
Dividend hiked and stock buyback expanded, but services revenue falls short of Street target
Cisco Systems Inc. shares rose in the extended session Wednesday after the network giant's quarterly results topped Wall Street estimates.
Cisco (CSCO) shares rose 2.8% after hours, following a 0.8% decline to close the regular session at $47.50. In comparison, the Dow Jones Industrial Average , which counts Cisco as a component, rose 0.5%, the S&P 500 index gained 0.3%, and the tech-heavy Nasdaq Composite Index advanced less than 0.1%.
The networking company reported fiscal second-quarter net income of $2.82 billion, or 63 cents a share, compared with a loss of $8.78 billion, or $1.78 a share, in the year-ago period. Adjusted earnings were 73 cents a share. Of the 27 analysts surveyed by FactSet, Cisco on average was expected to post adjusted earnings of 72 cents a share for the second quarter. Cisco had forecast 71 cents to 73 cents a share.
Revenue rose to $12.45 billion from $11.89 billion in the year-ago quarter. Wall Street expected revenue of $12.42 billion from Cisco, according to 25 analysts polled by FactSet. Cisco had predicted revenue of $12.48 billion to $12.72 billion.
Total product revenue, which includes the family of Catalyst 9000 switches that are sold with a multiyear software subscription that gives the company a recurring revenue stream (http://www.marketwatch.com/story/cisco-earnings-show-turnaround-success-stock-zooms-toward-post-2000-highs-2018-02-14), rose 6% to $9.27 billion, while analysts were looking for $9.15 billion.
Of that, infrastructure platform revenue rose 6% to $7.13 billion versus the Street's $7.07 billion view. Applications revenue surged 24% to $1.47 billion, while analysts had estimated $1.35 billion. Security revenue, which has been bolstered by the acquisition of Duo Security (http://www.marketwatch.com/story/cisco-dances-with-duo-promises-235b-for-security-startup-2018-08-02), grew 18% to $658 million versus the $629.2 million Street view.
Services revenue, however, came in at $3.17 billion just shy of the $3.25 billion expected by analysts.
For the third quarter, Cisco expects earnings of 76 cents to 78 cents a share on 4% to 6% year-over-year revenue growth, or $12.96 billion to $13.21 billion. Analysts estimate earnings of 76 cents a share on revenue of $12.84 billion.
Also, Cisco announced its board authorized a 6% quarterly dividend hike to 35 cents a share, and a $15 billion increase to the company's share buyback program.
-Wallace Witkowski; 415-439-6400; AskNewswires@dowjones.com
> Dow Jones Newswires
February 13, 2019 16:40 ET (21:40 GMT) |
