Cisco Systems, Inc. (NASDAQ:CSCO) shares are trading lower Thursday following the release of fourth-quarter financial results on Wednesday after the market closed.
What To Know: Cisco reported adjusted earnings per share of 99 cents, beating the consensus estimate of 97 cents. In addition, the company reported sales of $14.67 billion, beating the consensus estimate of $14.61 billion.
Product revenue rose 10% year over year, while services revenue was flat. By geography, revenue increased 9% in the Americas, 4% in EMEA and 7% in APJC. Product gains were led by Networking up 12%, Security up 9%, Observability up 4% and Collaboration up 2%.
GAAP gross margin improved to 65.7% from 64.4% a year ago, and non-GAAP gross margin rose to 68.4% from 67.9%.
GAAP operating income climbed 32% to $3.4 billion, with a margin of 23.5%. Non-GAAP operating income increased 13% to $5 billion, with a 34.3% margin.
GAAP net income rose 31% to $2.8 billion, or $0.71 per share. Non-GAAP net income was $4 billion, or $0.99 per share, up 12% and 14%, respectively.
Operating cash flow totaled $4.2 billion, up 14% from the prior year.
FY26 Outlook: The company sees adjusted earnings per share from $4.00 to $4.06, versus the consensus estimate of $3.79. Additionally, Cisco sees sales from $59.00 billion to $60.00 billion, versus the consensus estimate of $56.62 billion.
Q1 Outlook: The company anticipates adjusted earnings per share from 97 cents to 99 cents, versus the consensus estimate of 97 cents. Furthermore, Cisco expects sales from $14.65 billion to $14.85 billion, versus the consensus estimate of $14.62 billion.
Analyst Changes: Following the earnings report, multiple analysts issued price target adjustments.
- B of A Securities analyst Tal Liani maintained a Buy rating on Cisco and raised the price target from $76 to $85.
- Barclays analyst Tim Long maintained an Equal-Weight rating on Cisco and raised the price target from $66 to $71.
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CSCO Price Action: At the time of writing, Cisco shares are trading 0.39% lower at $70.12, according to data from Benzinga Pro.
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