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Cisco (CSCO) to Report Q1 Earnings: What's in the Offing?
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Cisco Systems, Inc. (CSCO - Free Report) is set to report first-quarter fiscal 2021 results on Nov 12.
The company anticipates first-quarter fiscal 2021 revenues to decline 9-11% on a year-over-year basis. The Zacks Consensus Estimate for revenues is pegged at $11.88 billion, indicating a decline of 9.7% over the year-ago reported figure.
Non-GAAP earnings are anticipated between 69 cents and 71 cents per share. The Zacks Consensus Estimate for earnings stands at 71 cents per share, stable in the past 30 days. The figure suggests a decline of 15.5% from the prior-year quarter.
Notably, the company has a trailing four-quarter earnings surprise of 5.71%, on average.
Cisco’s fiscal first-quarter performance is likely to reflect solid momentum in Webex Meetings, Webex Devices and Webex Teams, triggered by coronavirus crisis induced work-from-home wave and demand for telehealth services. Moreover, the transformation of free trials into paid subscriptions might have acted as a tailwind.
Further, the company updates its Webex portfolio on a monthly basis to aid users enhance productivity with advancements in video conferencing. Integration of advanced AI and ML (or machine learning) capabilities is expected to have bolstered engagement and driven adoption. This, in turn, may get reflected in the to-be-reported quarter’s results.
Besides, momentum in web security, unified threat, and network security and advanced threat offerings, driven by spending on cybersecurity as employees work remotely and surge in Internet traffic, is expected to have contributed to the fiscal first-quarter performance.
Likewise, solid uptick in cloud-based solutions, including Duo and Umbrella, bodes well. The company’s differentiated end-to-end approach across the network, cloud and endpoints is expected to have helped it expand clientele.
Additionally, strength in company’s Catalyst 9000 switch solutions might have driven growth in infrastructure domain. Accelerated deployment of 5G and growing adoption of Wi-Fi 6 compliant devices may have bolstered demand for Meraki solutions in the quarter to be reported.
Notably, during the quarter under review, Cisco announced that it was joining forces with Verizon Communications (VZ - Free Report) to provide sports fans with enriched in-stadium experiences as crowd entertainment slowly picks up pace. The company will combine Verizon’s 5G Ultra-Wideband network and 5G mobile edge computing (MEC) capabilities with its Sports and Entertainment solutions’ portfolio to enhance fan experience on site.
Moreover, the company rolled out Wide Area Networking (WAN) edge platform to enable organizations to swiftly migrate to cloud. Also, the WAN edge platform will provide improved connectivity for cloud and edge applications, and datacenter applications.
Also, robust implementation of latest SecureX offering — a comprehensive cloud-based security platform — to strengthen enterprise security infrastructure with unified visibility, automation and security capabilities across network endpoints, applications, and the cloud, is likely to have contributed to the to-be-reported quarter’s performance.
Meanwhile, incremental adoption of Secure Remote Worker, which leverages Zero Trust Architecture, combined with robust endpoint security portfolio of AnyConnect, Umbrella, Duo and AMP for Endpoints, is likely to have favored the top line in the quarter under review.
However, increasing investments on portfolio expansion, product enhancements and acquisitions amid stiff competition from Arista (ANET - Free Report) and Juniper (JNPR - Free Report) in networking infrastructure market may have impeded margin expansion in the fiscal first quarter.
Further, decline in IT spending and coronavirus pandemic-induced broader macroeconomic weakness across small and medium sized businesses might have affected the fiscal first-quarter performance.
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Cisco (CSCO) to Report Q1 Earnings: What's in the Offing?
Cisco Systems, Inc. (CSCO - Free Report) is set to report first-quarter fiscal 2021 results on Nov 12.
The company anticipates first-quarter fiscal 2021 revenues to decline 9-11% on a year-over-year basis. The Zacks Consensus Estimate for revenues is pegged at $11.88 billion, indicating a decline of 9.7% over the year-ago reported figure.
Non-GAAP earnings are anticipated between 69 cents and 71 cents per share. The Zacks Consensus Estimate for earnings stands at 71 cents per share, stable in the past 30 days. The figure suggests a decline of 15.5% from the prior-year quarter.
Notably, the company has a trailing four-quarter earnings surprise of 5.71%, on average.
Cisco Systems, Inc. Price and EPS Surprise
Cisco Systems, Inc. price-eps-surprise | Cisco Systems, Inc. Quote
Factors Likely to Have Influenced Q1 Results
Cisco’s fiscal first-quarter performance is likely to reflect solid momentum in Webex Meetings, Webex Devices and Webex Teams, triggered by coronavirus crisis induced work-from-home wave and demand for telehealth services. Moreover, the transformation of free trials into paid subscriptions might have acted as a tailwind.
Further, the company updates its Webex portfolio on a monthly basis to aid users enhance productivity with advancements in video conferencing. Integration of advanced AI and ML (or machine learning) capabilities is expected to have bolstered engagement and driven adoption. This, in turn, may get reflected in the to-be-reported quarter’s results.
Besides, momentum in web security, unified threat, and network security and advanced threat offerings, driven by spending on cybersecurity as employees work remotely and surge in Internet traffic, is expected to have contributed to the fiscal first-quarter performance.
Likewise, solid uptick in cloud-based solutions, including Duo and Umbrella, bodes well. The company’s differentiated end-to-end approach across the network, cloud and endpoints is expected to have helped it expand clientele.
Additionally, strength in company’s Catalyst 9000 switch solutions might have driven growth in infrastructure domain. Accelerated deployment of 5G and growing adoption of Wi-Fi 6 compliant devices may have bolstered demand for Meraki solutions in the quarter to be reported.
Notably, during the quarter under review, Cisco announced that it was joining forces with Verizon Communications (VZ - Free Report) to provide sports fans with enriched in-stadium experiences as crowd entertainment slowly picks up pace. The company will combine Verizon’s 5G Ultra-Wideband network and 5G mobile edge computing (MEC) capabilities with its Sports and Entertainment solutions’ portfolio to enhance fan experience on site.
Moreover, the company rolled out Wide Area Networking (WAN) edge platform to enable organizations to swiftly migrate to cloud. Also, the WAN edge platform will provide improved connectivity for cloud and edge applications, and datacenter applications.
Also, robust implementation of latest SecureX offering — a comprehensive cloud-based security platform — to strengthen enterprise security infrastructure with unified visibility, automation and security capabilities across network endpoints, applications, and the cloud, is likely to have contributed to the to-be-reported quarter’s performance.
Meanwhile, incremental adoption of Secure Remote Worker, which leverages Zero Trust Architecture, combined with robust endpoint security portfolio of AnyConnect, Umbrella, Duo and AMP for Endpoints, is likely to have favored the top line in the quarter under review.
However, increasing investments on portfolio expansion, product enhancements and acquisitions amid stiff competition from Arista (ANET - Free Report) and Juniper (JNPR - Free Report) in networking infrastructure market may have impeded margin expansion in the fiscal first quarter.
Further, decline in IT spending and coronavirus pandemic-induced broader macroeconomic weakness across small and medium sized businesses might have affected the fiscal first-quarter performance.
Zacks Rank
Currently, Cisco carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.
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