Cisco Systems released its latest earnings report after closing bell, posting adjusted earnings of 57 cents per share on $12 billion in revenue. Analysts had been expecting adjusted earnings of 55 cents per share on $11.97 billion in revenue. Management had guided for adjusted earnings of 54 cents to 56 cents per share and revenue growth of 1% to 4%, excluding the SP Video SPE business for the year-ago quarter. In last year’s third fiscal quarter, the company reported earnings of 54 cents per share on $12.1 billion in revenue.
Cisco Systems records strong growth
On a GAAP basis, Cisco reported earnings of 46 cents per share. The company’s Switching business recorded a 3% decline in revenue to $3.4 billion, while the NGN Routing segment’s revenue declined 5% to $1.9 billion. Collaboration revenue climbed 10% to $1.1 billion, while Data Center sales increased 1% to $811 million. Wireless sales increased 1% to $615 million, while Service Provider Video revenue increased 18% to $468 million. Security revenue climbed 17% to $482 million, while Other revenue increased 62% to $89 million. Services revenue grew 11% to $3.1 billion.
Analysts had been expecting Cisco Systems’ Switching business to post $3.53 billion in sales, Services to report $2.93 billion, and Routing to record $1.97 billion in sales. They were projecting $1.02 billion in revenue for the Collaboration business.
Deferred revenue increased 8% to $15.3 billion, including a 9% increase in deferred product revenue which was mostly driven by subscription-based products and software.
Cisco Systems releases strong guide
Cisco Systems management guided for fiscal fourth quarter adjusted earnings of 59 cents to 61 cents per share and GAAP earnings of 48 cents to 53 cents per share. They expect revenue to be flat to up 3% year over year, excluding the SP Video CPE Business in the year-ago quarter. Consensus estimates for the fourth quarter of Cisco’s fiscal 2016 are 58 cents per share in adjusted earnings and $12.4 billion in sales.
Shares of Cisco Systems surged in after-hours trades, climbing by as much as 5.05% to as high as $28.07 per share after tonight’s earnings announcement.