Cisco Systems Q1 Profit Tops Street - Update

(RTTNews) - Cisco Systems Inc. (CSCO) Wednesday reported a 48 percent surge in first-quarter profit as revenues and margins improved. Both Earnings and revenues for the quarter trumped Wall Street estimates. The Silicon Valley giant also provided a second-quarter outlook in line with estimates.

The San Jose, California-based networking-equipment maker reported first-quarter profit of $3.55 billion or $0.77 per share, up from last year's profit of $2.39 billion or $0.48 per share.

Adjusted earnings for the quarter were $0.75 per share, up from $0.61 per share last year. Analysts polled by Thomson Reuters estimated earnings of $0.72 per share for the quarter.

Revenues for the quarter grew 8 percent to $13.07 from $12.14 billion last year. Analysts had a consensus revenue estimate of $12.87 billion for the quarter.

"We had a strong start to fiscal 2019 and we believe our opportunity has never been greater," said CEO Chuck Robbins. "Our customers are looking to Cisco as a trusted partner to help them operate in a multi-cloud world and to transform their businesses. Our strategy is working and we are well positioned with our growing and differentiated portfolio across multiple domains to bring our customers a more secure, automated and simple IT infrastructure."

Gross margin improved to 62.3 percent from 61.2 percent last year. Operating expenses were $4.3 billion, down 7 percent.

Looking forward to the second quarter, Cisco expects adjusted earnings of $0.71 to $0.73 per share with revenue growth of 5 to 7 percent. Analysts currently expect earnings of $0.72 per share, with revenue growth of 5.40 percent.

CSCO closed Wednesday's trading at $44.33, down $0.79 or 1.75%, on the Nasdaq. The stock, however, gained $0.17 or 0.38% in after-hours trading.