Cisco’s Stock Pops On Earnings Beat


Posted May 29, 2016 by monexBMOsecurities

Network infrastructure company, Cisco, sees shares pop on better-than-expected earnings.

 
Shares in networks company, Cisco Systems, jumped in after-hours trading after it published better-than-expected quarterly earnings.

The San Jose, California-based company reported earnings of 57 cents a share on revenues of $12 billion for its fiscal 2016 third quarter. The amount of profit per share increased by 6% year-on-year, although total sales declined 1% from $12.14 billion in the same period.

The company provided encouraging guidance for its fiscal fourth quarter saying it expected earnings of 59 to 61 cents per share, comparing favorably with the 58 cents consensus Wall Street forecast. The company anticipates revenue coming in a range between 0% - +3% percent compared with the same period last year which compared well with analysts' expectations for a decrease.

“Because Cisco generates more than a third of its income from outside the States, analysts have been watching closely to see how the global economic slowdown affected it trading conditions,” explained Mike Lipton, technology analyst at Monex Financial.

Cisco’s revenue in the Americas declined 3% to $7.06 billion while Europe, Middle East and Africa sales fell 4% to $3 billion. Asia, including China and Japan, however, bucked the trend posting an impressive 10% jump in revenues.

“The company acquitted itself well but drilling down into the data paints a picture of the US that the challenging conditions at home,” said Lipton.

Monex Financial say it expects the global economic slowdown to continue to impact upon overseas revenues for some American companies citing the strength of the US dollar which makes their services and goods more expensive in foreign markets.


About Monex Financial
Monex Financial is a privately held, fully independent investment and wealth management leader, with retail operations based in Toronto, Canada and corporate trading division headquartered in Tokyo, Japan.

From our offices in Toronto the capital city of the province of Ontario and financial and business capital of Canada, we serve private individuals and families from N. America to Europe and with our corporate trading division strategically located in Tokyo, Japan, we have unrivalled access to Asia’s high yielding emerging markets, access to corporate resources, private equity and global mergers and acquisitions.
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Last Updated May 29, 2016