Cisco Systems (CSCO) stock is trading lower Thursday even after the networking equipment specialist beat top- and bottom-line expectations for its fiscal 2025 first quarter and raised its full-year outlook.
In the three months ended October 26, Cisco's revenue decreased 5.6% year over year to $13.8 billion, pressured by a 28% decline in its Networking segment to $6.8 billion. Its earnings per share (EPS) were down 18% from the year-ago period to 91 cents.
"Cisco is off to a strong start to fiscal 2025," said CEO Chuck Robbins in a statement. "Our customers are investing in critical infrastructure to prepare for artificial intelligence (AI), and with the breadth of our portfolio, we are uniquely positioned to capitalize on this opportunity."
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The results beat analysts' expectations. Wall Street was anticipating revenue of $13.77 billion and earnings of 87 cents per share, according to CNBC.
Since its Q1 results came in at the high end or above its guidance range, Cisco raised its outlook for the full fiscal year. The company now expects to achieve revenue in the range of $55.3 billion to $56.3 billion and earnings per share between $3.60 to $3.66. This compares to its previous forecast for revenue in the range of $55 billion to $56.2 billion and EPS of $3.52 to $3.58.
"We are focused on solid execution and operating discipline while making strategic investments to drive innovation and growth," said Cisco Chief Financial Officer Scott Herren.
Is Cisco stock a buy, sell or hold?
Cisco Systems is up 17% for the year to date on a total return basis (price change plus dividends) and Wall Street is moderately bullish on the blue chip stock.
According to S&P Global Market Intelligence, the average analyst target price for CSCO is $60.37, representing implied upside of roughly 5% to current levels. Meanwhile, the consensus recommendation is Buy.
Financial services firm Jefferies is one of those with a Buy rating on the Dow Jones stock. It also raised its price target on Cisco to $66 from $53 after earnings.
"Cisco reported solid results and guidance, bolstered by depleted customer inventory and positive AI commentary," wrote Jefferies analyst George Notter in a November 13 note. "Splunk was better than we expected. Order trends were strong – albeit on easy year-ago comparisons. Margins are looking good too as the company continues to manage costs tightly. We still think the risk/reward in the shares is tilted positively."
Related Content
- Kiplinger's Earnings Calendar for This Week
- Why Is Warren Buffett Selling So Much Stock?
- Best Dividend Stocks to Buy for Dependable Dividend Growth
-
4 Career Moves to Make Now if You're Worried About a RecessionWorried about a recession? These steps to protect your job prospects will help you professionally whether a downturn develops or not.
-
How StoryCorps Works and How You Can Tell Your StoryStoryCorps has recorded conversations between thousands of people, and anyone can participate. National facilitator Alan Jinich explains how to share your story.
-
I'm a Retirement Psychologist: Here's Why Doing What You 'Ought' in Retirement Beats Doing Whatever You WantTrue retirement freedom isn't about simply doing whatever you want, but about finding purpose and direction through commitments that align with your deepest values and allow you to contribute meaningfully.
-
Tactical Roth Conversions: Why 2025-2028 Is a Critical Window for RetireesThe One Big Beautiful Bill (OBBB) extended today's low tax brackets, but they may not last. Here's how smart planning now can prevent costly tax surprises later.
-
Ready to Retire? It's Not Too Late to Convert to a Roth IRAMillions of Americans are turning 65 this year. If you're retiring soon, don't dismiss the idea of a Roth conversion — it could still be a smart move even now.
-
9 Warren Buffett Quotes for Investors to Live ByWarren Buffett transformed Berkshire Hathaway from a struggling textile firm to a sprawling conglomerate and investment vehicle. Here's how he did it.
-
I'm a Financial Adviser: Three Things You Will Wish You Did Before the Fed Cuts Interest RatesWith potential interest rate cuts on the horizon, you might want to lock in today's higher yields and consider adjusting your asset allocation.
-
Simple Ways to Save on Back-to-School Shopping This YearSet a budget and stick to it, scour the house for what you already have, decorate backpacks and lunch boxes with your kids and consider buying some items during holiday sales.
-
Stocks End Strong Month on a Down Note: Stock Market TodayThere was likely a bit of profit-taking ahead of a historically weak September.
-
If You'd Put $1,000 Into UnitedHealth Group Stock 20 Years Ago, Here's What You'd Have TodayUNH stock was a massive market beater for ages – until it wasn't.
