Cisco’s per-share earnings jump 22% in the fiscal fourth quarter

Cisco Systems Inc. (NASDAQ: CSCO) published a stronger than expected earnings report for the fiscal fourth quarter on Wednesday. CEO Chuck Robbins, however, was dovish on the company’s performance in the future that resulted in a 6% decline in its shares in extended trading. Cisco had also topped analysts’ estimates for earnings and revenue in the prior quarter.

Including the decline in after-hours trading on Wednesday, shares of the company are now exchanging hands at £34.52 per share that translates to more than 35% recovery from its year to date low of £25.47 per share in March when COVID-19 disrupted operations for businesses from across the globe.

Cisco’s Q4 financial results versus analysts’ estimates

According to Refinitiv, experts had forecast the company to print £9.27 billion in revenue in the fourth quarter. Their estimate for earnings per share (EPS) was capped at 56.78 pence per share. In its report on Wednesday, Cisco topped both estimates posting a higher £9.32 billion in revenue and 61.38 pence of earnings per share in Q4.

The technology conglomerate reported a 9% decline in operating expenses in the recent quarter that resulted in a 22% year over year increase in its per-share earnings. On the revenue front, however, it saw a 9% annualised decline.

The American multinational said on Wednesday that it generated a total of £5.09 billion of revenue from its Infrastructure Platforms segment that represents a 16% decline as compared to the same quarter last year. Analysts had anticipated a lower £4.97 billion of revenue from this unit in the fourth quarter.

Cisco’s revenue from applications tanks 9% in Q4

Revenue from applications came in at £1.04 billion in Q4 versus £1.11 billion expected. As per Cisco, its applications revenue tanked 9% versus the year-ago figure. Cisco expressed plans of acquiring Thousand Eyes (network monitoring firm) in the recent quarter for roughly £770 million.

For the fiscal first quarter, Cisco now forecasts a 7% to 9% decline in revenue and per-share earnings in the range of 52.94 to 54.48 pence. Analysts, on the other hand, estimate an about 7% decline in revenue and 58.31 pence of earnings per share in Q1.

As per CEO Robbins, Cisco is committed to slashing costs by £770 million on an annualised basis. At the time of writing, Cisco is valued at £155.83 billion and has a price to earnings ratio of 19.02.