Revenues and margins above expectations Cisco: The company announced for the first quarter of fiscal 2024 profit of $3.64 billion, which equates to 89 cents per share. After adjusting for one-time earnings and expenses, the number was $1.11 per share, beating the average analyst estimate, which Zacks Investment Research said should not go above $1.03. Instead, revenue came in at $14.67 billion versus the $14.61 billion expected..
“We had a solid start to fiscal 2024, with the strongest first quarter results in our history for both revenue and profitability,” he said. Chuck Robbins, Chairman and CEO of Cisco. “We are confident in the strength of our business and the future growth opportunities it will drive ACCORDING TOsecurity and the cloud“.
2024 guidance revised downwards
However, despite the good performance, Cisco had to cut its full-year revenue and profit forecasts due to the decreasing demand for network equipment. Specifically, for the second quarter, the group estimates turnover between 12.6 and 12.8 billion dollars, missing analyst estimates of $14.19 billion. For the financial year 2024, which we are talking about revenue between $53.8 billion and $55 billion and adjusted earnings per share between $3.87 and $3.93. The company had previously forecast annual revenue in the range of $57 billion to $58.2 billion and adjusted earnings per share of $4.01 to $4.08.
Strategies that are good for business and cybersecurity
Cisco said it registered “a slowdown in new product orders in the first quarter…and believes the main reason is that customers are currently focused on installing and deploying the product into their environments.”
Orders will grow again in the second half of the year
After all, in recent years the company has faced supply chain issues and a post-pandemic slowdown in demand, which has accelerated its push into software offerings such as cybersecurity. In order to diversify its business and take advantage of the boom in artificial intelligence, Cisco decided in September, for example to buy cybersecurity company Splunk for about $28 billion.
While macroeconomic challenges remain, most of the supply chain constraints are “now behind us,” executives told analysts, adding that both lead times and order backlogs have largely returned to normal levels. Chief Financial Officer Scott Herren added that the company expects “return to order growth in the second half of the year“.
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