) has reported its fiscal Q4 2014 earnings after the bell
Wednesday, with typically positive results: the tech giant posted
earnings per share (EPS) of 50 cents per share (actual, GAAP) on
total sales in the quarter of $12.36 billion. This topped the Zacks
consensus estimates of 48 cents per share on $12.12 billion in
It would seem at first blush that Cisco's foray a few years back
diving into cloud-based solutions is showing signs of paying off,
especially with beating expectations on the revenue side (an
earnings beat for Cisco is a no-brainer by this point; the company
hasn't posted a negative earnings surprise since 2008). Cisco's
products (consisting of mostly routers and switchers, where they
are still a first-tier producer) brought in $9.5 billion in the
quarter, while services garnered $2.8 billion.
It will likely take the conference call coming a bit later to
really dig into the substance of these numbers, especially
regarding guidance for fiscal year 2015, but the year-over-year
growth is likely a good sign that the move toward the "Intercloud"
is now bearing some fruit. Gross margins seem to be a bit under
pressure, which has been the case with Cisco -- as well as plenty
other big names in tech trying to make the jump into the
high-growth end, like IBM (
) -- for awhile now.
Cisco also bought back 1.5 billion in CSCO shares for the
quarter, another thing investors have come to expect. The company's
4% positive earnings surprise is about exactly the average for the
past four quarters, as well. What's nice to see for Cisco that's
not so typical is the back-to-back beats on the top line.
Analysts typically have made no adjustments to earnings
expectations for Cisco Systems in the quarter; once guidance is
established and certain aspects are discussed on the call -- among
them enterprise IT spending trends, growth in China and Cisco's 9%
revenue exposure in Russia -- investors will have a better idea how
to play the Zacks Rank #3 stock going forward. Year to date, Cisco
shares are up 12%, but year over year they're down about 4%.
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