UPDATE:Networking heavyweight Cisco Systems reported sales and earnings that were slightly ahead of Wall Street expectations.
The company said it earned net income of $1.9 billion during its fiscal fourth quarter, or $0.47 per share. Revenues totaled $11.69 billion.
Analysts polled by Bloomberg had forecast earnings per share of $0.46 on sales of $11.6 billion.
“Our strategy — delivering intelligent networks and technology architectures, built on integrated products, services and software platforms, to fuel our customers’ businesses — is proving the right long-term strategy for our success,” the company’s Chief Executive John Chambers said.
Cisco also boosted its quarterly dividend by 75 per cent to $0.14 a share.
While speaking with Maria Bartiromo on CNBC’s Closing Bell, Chambers said the company added 1,400 employees during the period — including 500 college graduates and interns. That follows Cisco’s decision to cut more than 1,300 people in July in two sales divisions.
Chambers also said the Cisco saw strong results in Asia, including a resurgence in India and China. European clients remained weak, he said.
Sales in the U.S. are trending positively, but will be impacted by lower federal government orders.
Shares are up more than 3 per cent in after-hours trade.
Technology giant Cisco Systems is set to report quarterly results after markets close in the U.S., with analysts forecasting top line results to grow moderately.
The world’s largest maker of networking equipment is expected to post earnings per share of $0.46 on sales of $11.6 billion.
This is the first time Cisco will report earnings since it announced more than 1,300 job cuts in July.
Cisco targeted its WebEx and Wide Area Application Services sales teams. The latter focuses on speeding network data processing.
Deutsche Bank’s Brian Modof maintains his buy rating of Cisco ahead of earnings, betting the company’s cost cuts will help its bottom line. Modof also believes U.S. corporates may be increasing technology spending.
“Improving fundamentals are likely to be driven by early signs of ‘stabilisation’ in U.S. enterprise IT spending and a modest improvement in Fortune 100 IT spending, heading into the back-half,” Modof says. “Cisco is also likely to benefit from strong multi-quarter product cycle ramps in 10GE switching, Private Clouds, broadband mobility, security, and advanced services.”
Cisco’s quarterly announcement could include substantial noise, after it closed the acquisition of digital video firm NDS Group at the end of the quarter.
The $4 billion deal may not have been fully calculated into all analyst estimates.
Shares are up more than 1 per cent in late-afternoon trade.