Cisco Systems (CSCO - Free Report) reported fourth-quarter fiscal 2022 non-GAAP earnings of 83 cents per share, which lagged the Zacks Consensus Estimate by 27.38%. The bottom line decreased 1.2% year over year.
Revenues were almost unchanged year over year at $13.10 billion. Revenues beat the consensus mark by 2.75%.
Quarter in Detail
Region-wise, the Americas revenues decreased 3% year over year to $7.47 billion. EMEA revenues increased 8% from the year-ago quarter to $3.58 billion. APJC revenues decreased 2% year over year to $2.06 billion.
Service revenues (26.1% of total revenues) were unchanged year over year at $3.41 billion.
Annualized recurring revenues (“ARR”) came in at $22.9 billion, up 8% year over year.
Product revenues (73.6% of total revenues) decreased 0.3% on a year-over-year basis to $9.69 billion.
Break Down of Product Revenues
Secure, Agile Networks (62.9% of total Product revenues) revenues decreased 1% year over year to $6.09 billion.
Collaboration (12% of Product revenues) revenues increased 2% on a year-over-year basis to $1.16 billion.
End-to-End Security (10.2% of Product revenues) revenues were up 20% to $984 million.
Internet for the Future (13% of Product revenues) revenues decreased 10% to $1.26 billion.
Optimized Application Experiences (1.9% of Product revenues) revenues were up 8% to $185 million.
Revenues from Other Products decreased 22% to $3 million.
Operating Details
Non-GAAP gross margin contracted 270 basis points (bps) from the year-ago quarter’s level to 62.9%.
On a non-GAAP basis, product gross margin contracted 370 bps to 61.3%. Service gross margin remained unchanged at 61.3%.
Non-GAAP operating expenses were $4.59 billion, up 8.9% year over year. As a percentage of revenues, operating expenses expanded 290 bps to 35%.
Non-GAAP operating margin expanded 20 bps year over year to 32.4%.
Balance Sheet and Cash Flow
As of Jul 30, 2022, Cisco’s cash & cash equivalents and investments balance were $19.3 billion compared with $20.1 billion as of Apr 30, 2022.
Total debt (short-term plus long-term) as of Jul 30, 2022, was $9.52 billion compared with $9.42 billion as of Apr 30, 2022.
Cash flow from operating activities was $3.7 billion, unchanged from the previous quarter.
Cisco paid a quarterly dividend of 38 cents per share and returned $2.4 billion to shareholders through buybacks.
Remaining performance obligations (“RPO”) at the end of the fiscal fourth quarter were $31.5 billion, up 2%, with 54% of this amount to be recognized as revenues over the next 12 months. Product RPO was up 6% and service RPO was down 1%.
Guidance
For first-quarter fiscal 2023, revenues are expected to grow between 2% and 4% on a year-over-year basis.
Non-GAAP gross margin is anticipated between 63% and 64% for the quarter.
Non-GAAP operating margin is anticipated between 31.5% and 32.5% for the quarter. Non-GAAP earnings are anticipated between 82 cents and 84 cents per share.
For fiscal 2023, revenues are expected to rise by 4-6% on a year-over-year basis. Non-GAAP earnings are anticipated between $3.49 and $3.56 per share.
Zacks Rank & Upcoming Earnings to Watch
Cisco currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Computer & Technology sector scheduled to report their earnings soon are Intuit (INTU - Free Report) , Palo Alto Networks (PANW - Free Report) and Hewlett Packard (HPE - Free Report) . While both Intuit and Palo Alto Network have a Zacks Rank #2 (Buy), Hewlett Packard sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Intuit’s shares have underperformed the sector year to date, declining 25.7%.
INTU is scheduled to release fourth-quarter fiscal 2022 results on Aug 23.
Palo Alto Networks shares have outperformed the sector year to date, declining 7.6%.
PANW is scheduled to release fourth-quarter fiscal 2022 results on Aug 22.
Hewlett Packard shares have outperformed the sector year to date, declining 5.4%.
HPE is set to report third-quarter fiscal 2022 results on Aug 30.
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Cisco Systems (CSCO - Free Report) reported fourth-quarter fiscal 2022 non-GAAP earnings of 83 cents per share, which lagged the Zacks Consensus Estimate by 27.38%. The bottom line decreased 1.2% year over year.
Revenues were almost unchanged year over year at $13.10 billion. Revenues beat the consensus mark by 2.75%.
Quarter in Detail
Region-wise, the Americas revenues decreased 3% year over year to $7.47 billion. EMEA revenues increased 8% from the year-ago quarter to $3.58 billion. APJC revenues decreased 2% year over year to $2.06 billion.
Service revenues (26.1% of total revenues) were unchanged year over year at $3.41 billion.
Annualized recurring revenues (“ARR”) came in at $22.9 billion, up 8% year over year.
Product revenues (73.6% of total revenues) decreased 0.3% on a year-over-year basis to $9.69 billion.
Break Down of Product Revenues
Secure, Agile Networks (62.9% of total Product revenues) revenues decreased 1% year over year to $6.09 billion.
Collaboration (12% of Product revenues) revenues increased 2% on a year-over-year basis to $1.16 billion.
End-to-End Security (10.2% of Product revenues) revenues were up 20% to $984 million.
Internet for the Future (13% of Product revenues) revenues decreased 10% to $1.26 billion.
Optimized Application Experiences (1.9% of Product revenues) revenues were up 8% to $185 million.
Revenues from Other Products decreased 22% to $3 million.
Operating Details
Non-GAAP gross margin contracted 270 basis points (bps) from the year-ago quarter’s level to 62.9%.
On a non-GAAP basis, product gross margin contracted 370 bps to 61.3%. Service gross margin remained unchanged at 61.3%.
Non-GAAP operating expenses were $4.59 billion, up 8.9% year over year. As a percentage of revenues, operating expenses expanded 290 bps to 35%.
Non-GAAP operating margin expanded 20 bps year over year to 32.4%.
Balance Sheet and Cash Flow
As of Jul 30, 2022, Cisco’s cash & cash equivalents and investments balance were $19.3 billion compared with $20.1 billion as of Apr 30, 2022.
Total debt (short-term plus long-term) as of Jul 30, 2022, was $9.52 billion compared with $9.42 billion as of Apr 30, 2022.
Cash flow from operating activities was $3.7 billion, unchanged from the previous quarter.
Cisco paid a quarterly dividend of 38 cents per share and returned $2.4 billion to shareholders through buybacks.
Remaining performance obligations (“RPO”) at the end of the fiscal fourth quarter were $31.5 billion, up 2%, with 54% of this amount to be recognized as revenues over the next 12 months. Product RPO was up 6% and service RPO was down 1%.
Guidance
For first-quarter fiscal 2023, revenues are expected to grow between 2% and 4% on a year-over-year basis.
Non-GAAP gross margin is anticipated between 63% and 64% for the quarter.
Non-GAAP operating margin is anticipated between 31.5% and 32.5% for the quarter. Non-GAAP earnings are anticipated between 82 cents and 84 cents per share.
For fiscal 2023, revenues are expected to rise by 4-6% on a year-over-year basis. Non-GAAP earnings are anticipated between $3.49 and $3.56 per share.
Zacks Rank & Upcoming Earnings to Watch
Cisco currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Computer & Technology sector scheduled to report their earnings soon are Intuit (INTU - Free Report) , Palo Alto Networks (PANW - Free Report) and Hewlett Packard (HPE - Free Report) . While both Intuit and Palo Alto Network have a Zacks Rank #2 (Buy), Hewlett Packard sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Intuit’s shares have underperformed the sector year to date, declining 25.7%.
INTU is scheduled to release fourth-quarter fiscal 2022 results on Aug 23.
Palo Alto Networks shares have outperformed the sector year to date, declining 7.6%.
PANW is scheduled to release fourth-quarter fiscal 2022 results on Aug 22.
Hewlett Packard shares have outperformed the sector year to date, declining 5.4%.
HPE is set to report third-quarter fiscal 2022 results on Aug 30.
4 Oil Stocks with Massive Upsides
Global demand for oil is through the roof... and oil producers are struggling to keep up. So even though oil prices are well off their recent highs, you can expect big profits from the companies that supply the world with "black gold."
Zacks Investment Research has just released an urgent special report to help you bank on this trend.
In Oil Market on Fire, you'll discover 4 unexpected oil and gas stocks positioned for big gains in the coming weeks and months. You don't want to miss these recommendations.
Download your free report now to see them.
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