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Cisco's (CSCO) Q4 Earnings Top Estimates, Revenues Up Y/Y
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Cisco Systems (CSCO - Free Report) reported fourth-quarter fiscal 2023 non-GAAP earnings of $1.14 per share, which beat the Zacks Consensus Estimate by 7.55%. The bottom line jumped 37.3% year over year.
Revenues increased 16% year over year to $15.2 billion and beat the consensus mark by 1.04%. Product revenues (76.6% of total revenues) increased 20.3% on a year-over-year basis to $11.09 billion.
Secure, Agile Networks revenues rose 33% year over year to $8.125 billion, beating the consensus mark by 5.85%. End-to-End Security revenues were $987 million, which missed the Zacks Consensus Estimate by 3.04%.
Internet for the Future revenues increased 3% to $1.298 billion, missing the consensus mark by 9.29%. Optimized Application Experiences revenues were up 15% to $214 million and beat the consensus mark by 2.43%.
Collaboration revenues decreased 12% on a year-over-year basis to $1.023 billion. Revenues from Other Products decreased 33% to $2 million.
Cisco Systems, Inc. Price, Consensus and EPS Surprise
Service revenues (23.4% of total revenues) inched up 4.1% year over year to $3.55 billion.
Quarter in Detail
Region-wise, America’s revenues increased 12% year over year to $9.075 billion and beat the consensus mark by 4.34%. EMEA revenues increased 10% from the year-ago quarter to $3.93 billion but lagged the consensus mark by 2.9%. APJC revenues increased 7% year over year to $2.203 billion but missed the consensus mark by 2.59%
Annualized recurring revenues came in at $24.3 billion, up 5% year over year. Product ARR increased 10% year over year.
Non-GAAP gross margin expanded 270 basis points (bps) from the year-ago quarter’s level to 65.9%.
On a non-GAAP basis, the product gross margin expanded 420 bps to 65.5%. Service gross margin contracted 150 bps to 67.5%.
Non-GAAP operating expenses were $4.65 billion, up 14.7% year over year. As a percentage of revenues, operating expenses decreased 40 bps year over year to 30.6%.
Non-GAAP operating margin expanded 300 bps year over year to 35.4%.
Balance Sheet and Cash Flow
As of Jul 29, 2023, Cisco’s cash & cash equivalents and investments balance were $26.15 billion compared with $23.29 billion as of Apr 29, 2023.
Total debt (short-term plus long-term) as of Jul 29, 2023, was $8.39 billion, unchanged sequentially.
Cash flow from operating activities was $6 billion, higher than the $5.2 billion reported in the previous quarter.
The remaining performance obligations (“RPO”) at the end of the fiscal fourth quarter were $34.9 billion, up 11%, with 51% of this amount to be recognized as revenues over the next 12 months. Product RPO was up 12% and service RPO was up 9%.
Guidance
For first-quarter fiscal 2024, revenues are expected to be between $14.5 billion and $14.7 billion. The Zacks Consensus Estimate for revenues is pegged at $14.53 billion, within management’s guided range.
Non-GAAP gross margin is anticipated between 64.5% and 65.5% for the quarter.
Non-GAAP operating margin is expected between 34% and 35% for the quarter.
Non-GAAP earnings are anticipated between $1.02 and $1.04 per share. The Zacks Consensus Estimate is currently pegged at 99 cents per share, lower than management’s guided range.
For fiscal 2024, revenues are expected between $57 billion and $58.2 billion. Non-GAAP earnings are anticipated between $4.01 and $4.08 per share.
The consensus mark for fiscal 2024 earnings and revenues are pegged at $4.04 per share and $58.28 billion, respectively.
Image: Bigstock
Cisco's (CSCO) Q4 Earnings Top Estimates, Revenues Up Y/Y
Cisco Systems (CSCO - Free Report) reported fourth-quarter fiscal 2023 non-GAAP earnings of $1.14 per share, which beat the Zacks Consensus Estimate by 7.55%. The bottom line jumped 37.3% year over year.
Revenues increased 16% year over year to $15.2 billion and beat the consensus mark by 1.04%. Product revenues (76.6% of total revenues) increased 20.3% on a year-over-year basis to $11.09 billion.
Secure, Agile Networks revenues rose 33% year over year to $8.125 billion, beating the consensus mark by 5.85%. End-to-End Security revenues were $987 million, which missed the Zacks Consensus Estimate by 3.04%.
Internet for the Future revenues increased 3% to $1.298 billion, missing the consensus mark by 9.29%. Optimized Application Experiences revenues were up 15% to $214 million and beat the consensus mark by 2.43%.
Collaboration revenues decreased 12% on a year-over-year basis to $1.023 billion. Revenues from Other Products decreased 33% to $2 million.
Cisco Systems, Inc. Price, Consensus and EPS Surprise
Cisco Systems, Inc. price-consensus-eps-surprise-chart | Cisco Systems, Inc. Quote
Service revenues (23.4% of total revenues) inched up 4.1% year over year to $3.55 billion.
Quarter in Detail
Region-wise, America’s revenues increased 12% year over year to $9.075 billion and beat the consensus mark by 4.34%. EMEA revenues increased 10% from the year-ago quarter to $3.93 billion but lagged the consensus mark by 2.9%. APJC revenues increased 7% year over year to $2.203 billion but missed the consensus mark by 2.59%
Annualized recurring revenues came in at $24.3 billion, up 5% year over year. Product ARR increased 10% year over year.
Non-GAAP gross margin expanded 270 basis points (bps) from the year-ago quarter’s level to 65.9%.
On a non-GAAP basis, the product gross margin expanded 420 bps to 65.5%. Service gross margin contracted 150 bps to 67.5%.
Non-GAAP operating expenses were $4.65 billion, up 14.7% year over year. As a percentage of revenues, operating expenses decreased 40 bps year over year to 30.6%.
Non-GAAP operating margin expanded 300 bps year over year to 35.4%.
Balance Sheet and Cash Flow
As of Jul 29, 2023, Cisco’s cash & cash equivalents and investments balance were $26.15 billion compared with $23.29 billion as of Apr 29, 2023.
Total debt (short-term plus long-term) as of Jul 29, 2023, was $8.39 billion, unchanged sequentially.
Cash flow from operating activities was $6 billion, higher than the $5.2 billion reported in the previous quarter.
The remaining performance obligations (“RPO”) at the end of the fiscal fourth quarter were $34.9 billion, up 11%, with 51% of this amount to be recognized as revenues over the next 12 months. Product RPO was up 12% and service RPO was up 9%.
Guidance
For first-quarter fiscal 2024, revenues are expected to be between $14.5 billion and $14.7 billion. The Zacks Consensus Estimate for revenues is pegged at $14.53 billion, within management’s guided range.
Non-GAAP gross margin is anticipated between 64.5% and 65.5% for the quarter.
Non-GAAP operating margin is expected between 34% and 35% for the quarter.
Non-GAAP earnings are anticipated between $1.02 and $1.04 per share. The Zacks Consensus Estimate is currently pegged at 99 cents per share, lower than management’s guided range.
For fiscal 2024, revenues are expected between $57 billion and $58.2 billion. Non-GAAP earnings are anticipated between $4.01 and $4.08 per share.
The consensus mark for fiscal 2024 earnings and revenues are pegged at $4.04 per share and $58.28 billion, respectively.
Zacks Rank & Upcoming Earnings to Watch
Cisco currently carries a Zacks Rank #2 (Buy).
NVIDIA (NVDA - Free Report) , NetEase (NTES - Free Report) and Workday (WDAY - Free Report) are some other top-ranked stocks that investors can consider in the Zacks Computer & Technology sector. All three stocks sport a Zacks Rank #1 (Strong Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.
While NVIDIA is set to report its quarterly results on Aug 23, both NetEase and Workday are scheduled to report on Aug 24.