After the bell on Wednesday, networking equipment giant Cisco Systems, Inc. (CSCO) said it saw both higher profits and revenue in the second quarter that exceeded Wall Street analyst expectations.
The San Jose, California-based company reported second quarter net income of $3.1 billion, or 59 cents per share, up from $2.2 billion, or 40 cents per share, in the year-ago quarter.
Adjusting for one-time items like various tax benefits, profits came in at $2.7 billion, or 51 cents per share, versus a profit of $2.6 billion, or 47 cents per share, a year earlier. According to Thomson Reuters, this beat the Wall Street estimates as analysts expected CSCO to earn 48 cents per share.
Revenue for the quarter was up about 5% to $12.10 billion from $11.53 billion in the second quarter a year earlier. Analysts were expecting revenue to be $12.06 billion.
Though the company beat Wall Street estimates, going forward Cisco faces hurdles amid a weak European market. There have been signs that European growth is on the mend, but CEO John Chambers cautions investors and analysts that it is too early to get excited.
Looking ahead to the third quarter, the company is expecting revenue to grow 4% to 6% with earnings in the range of 48 cents and 50 cents per share, in line with the analyst view of 49 cents per share.
Cisco shares were down 14 cents, or -0.66%, during pre-market trading on Thursday. The stock is up about +6% over the past year.
The Bottom Line
Shares of Cisco Systems (CSCO) have a dividend yield of 2.65% based on last night’s closing price of $21.14 and the company’s annualized dividend payout of 56 cents per share.
Cisco Systems, Inc. (CSCO) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.3 out of 5 stars.
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