Cisco reported Q1 results that beat expectations. Earnings in the quarter came in at $0.48 per share, topping the consensus estimate by $0.02 while revenue came in at $11.88 billion (a 5.5% year-over-year increase) which was ahead of the average analyst estimate of $11.77 billion.
Orders in the Americas were up 2% from the prior year, hurt by federal demand, while enterprise and service provider businesses were up 9% and 13%, respectively. Asia-Pacific was up 7%, driven by strength in India as Cisco continues to look to this region for growth in the face of weakness in Europe.
Management provided guidance for the second quarter, forecasting revenue growth of 3.5% to 5.5% and earnings in a range of $0.47 to $0.48 per share. Analysts were expecting growth of 4.2% and EPS of $0.47. Gross margin in the quarter is expected to be in the range of 61% to 62%, down from Q1’s 62.7%, with management pointing to a shift in product and the rapid growth of its UCS server line which has lower margins, as reasons for the decline.
Cisco Systems (CSCO : NASDAQ : US$17.66), Net Change: 0.81, % Change: 4.81%, Volume: 96,722,775