Cisco Shares plunged 17% in an extended deal on Wednesday after networking companies generated lower quarterly earnings than analysts expected and demanded an unexpected drop in sales this quarter.
The company’s way is as follows.
- Revenue: According to Refinitiv, analysts expected 86 cents per share, compared to 87 cents per share after adjustment.
- Revenue: According to Refinitiv, it’s $ 12.84 billion, compared to what analysts expected at $ 13.34 billion.
Cisco revenue was almost flat year-on-year in the quarter ending April 30. statement..of Last quarter, Revenue increased by 6%. This quarter lasted 13 weeks, a week less than the previous quarter. Net income was up 6% to $ 3.04 billion.
The war between Russia and Ukraine reduced revenues by about $ 200 million, increased cost of goods sold by Cisco by $ 5 million and increased operating expenses by $ 62 million in the quarter. The blockade of Covid-19 in China also exacerbated the shortage of parts, CEO Chuck Robbins said in a conference call with analysts.
In the fourth quarter, Cisco called for adjusted earnings per share to go from 76 cents to 84 cents, down 1% to 5.5% year-over-year. Analysts surveyed by Refinitiv wanted revenue of $ 13.87 billion, or about 6% growth, and revenue of 92 cents per share. According to Robins, the scope of guidance is wider than usual due to the increasingly complex environment.
“The top-line numbers don’t look good,” Robins said. However, employees are redesigning their products to take into account component diversity, which could enhance Cisco’s performance in the first half of next year, he said.
“To understand the size of the shortage, we are currently constraining about 350 critical components out of a total of 41,000 unique component part numbers in the fourth quarter,” said Scott Helen, Cisco’s chief financial officer. You can see it. ” “Our supply chain team is actively pursuing multiple options to fill these shortfalls.”
In China, Cisco faces a variety of uncertainties, Robins said.
“Shanghai is now saying it will open on June 1,” he said. “I don’t know exactly what that means, and when it means to start supplying. Correspondingly, when they open and when transportation logistics can be started. , We believe there will be a high degree of congestion. “
Robins added that the fourth-quarter guidance reflects issues such as port and airport capacity limits and “inbound efforts to return raw materials to the country.”
The impact was not limited to hardware. Software revenue fell 3% to $ 3.7 billion. Helen said growth would have been five points higher without the effects of the war in Ukraine and the additional week of the same period last year.
Guidance does not suggest changes in demand and strictly reflects supply restrictions, Helen said.
Cisco said secure and agile network segments, including data center networking switches, contributed $ 5.87 billion in revenue. This represents 4% growth, lower than the $ 6.09 billion consensus among analysts surveyed by Street Account.
Cisco’s Internet for the Future unit includes routed optical networking hardware acquired through the acquisition of Acacia Communications in 2021, contributing $ 1.32 billion below the $ 1.34 billion Street Account consensus, up 6%. I did.
The collaboration segment, including Webex, was down 7% to $ 1.13 billion in revenue, in line with Street Account’s consensus of $ 1.13 billion.
Cisco changed its policy during the quarter to prevent customers from canceling orders within 45 days of the estimated shipping date, Helen said.
At the end of the transaction, Cisco shares were down 23% from the beginning of the year, while S & P 500 was down about 18% over the same period.
–CNBC’s Ari Levy contributed to this report.
Cisco (CSCO) Revenues Q3 2022
Source link Cisco (CSCO) Revenues Q3 2022