Core Insights - Cisco Systems reported revenue of $14.15 billion for the quarter ended April 2025, reflecting an 11.4% increase year-over-year and a surprise of +0.65% over the Zacks Consensus Estimate of $14.06 billion [1] - The earnings per share (EPS) was $0.96, up from $0.88 in the same quarter last year, with a surprise of +5.49% compared to the consensus estimate of $0.91 [1] Revenue Breakdown - Product revenue reached $10.37 billion, exceeding the six-analyst average estimate of $10.08 billion, marking a year-over-year increase of +15% [4] - Service revenue was reported at $3.78 billion, slightly below the $3.82 billion average estimate, with a year-over-year change of +2.6% [4] - Security product revenue was $2.01 billion, lower than the estimated $2.21 billion, but showed a significant year-over-year increase of +54.4% [4] - Observability product revenue was $261 million, compared to the average estimate of $276.09 million [4] - Networking product revenue was $7.07 billion, surpassing the estimated $6.76 billion, with a year-over-year increase of +8.4% [4] - Collaboration product revenue was $1.03 billion, exceeding the five-analyst average estimate of $1 billion, representing a year-over-year change of +4.5% [4] Gross Margin Performance - Non-GAAP gross margin for services was $2.69 billion, slightly below the estimated $2.72 billion [4] - Non-GAAP gross margin for products was $7.01 billion, exceeding the estimated $6.66 billion [4] Stock Performance - Cisco shares have returned +8% over the past month, compared to the Zacks S&P 500 composite's +9.9% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Group 1: Earnings Performance - Cisco Systems reported quarterly earnings of $0.96 per share, exceeding the Zacks Consensus Estimate of $0.91 per share, and up from $0.88 per share a year ago, representing an earnings surprise of 5.49% [1] - The company posted revenues of $14.15 billion for the quarter ended April 2025, surpassing the Zacks Consensus Estimate by 0.65%, and an increase from year-ago revenues of $12.7 billion [2] Group 2: Stock Performance and Outlook - Cisco shares have increased approximately 4.4% since the beginning of the year, compared to the S&P 500's gain of 0.1% [3] - The current consensus EPS estimate for the upcoming quarter is $0.96 on revenues of $14.54 billion, and for the current fiscal year, it is $3.73 on revenues of $56.44 billion [7] Group 3: Industry Context - The Computer - Networking industry, to which Cisco belongs, is currently ranked in the bottom 38% of over 250 Zacks industries, indicating potential challenges in outperforming the market [8]

Cisco Systems (CSCO) Q3 2025 Earnings Call May 14, 2025 04:30 PM ET Company Participants Sami Badri - Head of Investor Relations & Strategic FinanceChuck Robbins - Chair and CEOScott Herren - EVP & CFOJoseph Cardoso - Vice President, Equity ResearchAmit Daryanani - Senior Managing Director - Equity ResearchSimon Leopold - Managing DirectorAndrew Spinola - DirectorKarl Ackerman - Managing Director - Equity ResearchAdrienne Colby - Assistant Vice President Conference Call Participants Meta Marshall - AnalystT ...

Financial Data and Key Metrics Changes - In Q3, total revenue was $14.1 billion, up 11% year over year, with non-GAAP net income at $3.8 billion and non-GAAP earnings per share at $0.96 [25][28] - Total product revenue increased to $10.4 billion, up 15%, while services revenue rose to $3.8 billion, up 3% [25][28] - Total annual recurring revenue (ARR) ended at $30.6 billion, a 5% increase, with subscription revenue up 15% to $7.9 billion, representing 56% of total revenue [26][28] Business Line Data and Key Metrics Changes - Networking revenue grew 8%, driven by double-digit growth in switching and enterprise routing, partially offset by a decline in servers [26][28] - Security revenue surged 54%, primarily due to growth in offerings from Splunk and SASE [26][28] - Collaboration revenue increased by 4%, while observability revenue rose by 24% [26][28] Market Data and Key Metrics Changes - Product orders grew 20% year over year, with a 9% increase when excluding Splunk [27] - In geographic segments, The Americas saw a 27% increase, EMEA was up 4%, and APJC grew by 21% [27] - In customer markets, Service Provider and Cloud orders increased by 32%, Enterprise orders were up 22%, and Public Sector orders rose by 8% [27] Company Strategy and Development Direction - Cisco is focusing on AI infrastructure, with over $600 million in AI infrastructure orders from web scale customers in Q3, surpassing the original target for the fiscal year [6][11] - The company is expanding partnerships, including a significant collaboration with NVIDIA to enhance AI capabilities [12][14] - Cisco is investing in the Kingdom of Saudi Arabia as a strategic technology partner for AI infrastructure, aligning with the country's Vision 2030 [13][14] Management's Comments on Operating Environment and Future Outlook - Management noted that customer purchasing behavior remains strong despite macroeconomic uncertainties, particularly in AI transitions [36][40] - The company expects continued growth in AI orders and infrastructure, with a focus on executing and increasing capacity [86] - Management anticipates that the sovereign AI cloud opportunity will ramp up in the near term, positioning Cisco as a core system provider [14][15] Other Important Information - Cisco returned $3.1 billion to shareholders in Q3 through dividends and share repurchases, with a total of $9.6 billion returned year to date [7][29] - The company announced the retirement of CFO Scott Herren at the end of fiscal year 2025, with Mark Patterson set to take over [19][20] Q&A Session Summary Question: What are you seeing in terms of customer buying behavior given the uncertainty with tariffs? - Management indicated no significant change in purchasing behavior, with customers committed to technology transitions, particularly in AI [36][37] Question: Is 2025 expected to be a peak year for cloud CapEx? - Management believes that global cloud CapEx will continue to grow, driven by sovereign cloud strategies and enterprise AI opportunities [48][50] Question: Can you elaborate on the $600 million in AI orders? - Management clarified that the $600 million in AI orders does not include any from the new Saudi AI company, which is just starting [55][57] Question: What is the impact of tariffs on guidance for Q4? - Management has built in expectations for tariffs in the Q4 guidance, reflecting the full cost without mitigation [88][97] Question: How is Cisco participating in the Middle East AI opportunities? - Management expects significant spending in the Middle East, with discussions focused on networking, compute, security, and observability [64][66]

Financial Data and Key Metrics Changes - Total revenue for Q3 was $14.1 billion, an increase of 11% year over year [24] - Non-GAAP net income was $3.8 billion, with non-GAAP earnings per share at $0.96 [24] - Total product revenue was $10.4 billion, up 15%, while services revenue was $3.8 billion, up 3% [24] - Total annualized recurring revenue (ARR) ended at $30.6 billion, a 5% increase [25] - Total subscription revenue increased by 15% to $7.9 billion, representing 56% of total revenue [25] - Non-GAAP gross margin was 68.6%, up 30 basis points year over year [27] - Non-GAAP operating margin was 34.5%, above the high end of guidance [28] Business Line Data and Key Metrics Changes - Networking product orders grew by 8%, with double-digit growth in switching and enterprise routing [25] - Security orders surged by 54%, driven by offerings from Splunk and SASE [25] - Collaboration revenue increased by 4%, while observability revenue rose by 24% [25] - Product orders were up 20% year over year, with a 9% increase when excluding Splunk [26] Market Data and Key Metrics Changes - In the Americas, product orders increased by 27%, while EMEA saw a 4% increase and APJC grew by 21% [26] - Service Provider and Cloud orders were up 32%, Enterprise orders increased by 22%, and Public Sector orders rose by 8% [26] Company Strategy and Development Direction - Cisco is focusing on AI infrastructure, with over $1 billion in AI orders received year to date, surpassing the original target [5][11] - The company is enhancing its partnerships, particularly with NVIDIA, to deliver integrated AI solutions [12] - Cisco is investing in strategic partnerships in Saudi Arabia to support AI infrastructure development [13][14] Management's Comments on Operating Environment and Future Outlook - Management noted that customer purchasing behavior remains stable despite tariff uncertainties, with continued commitment to technology transitions [35] - The company anticipates sustained demand for AI infrastructure and does not expect a significant slowdown in cloud CapEx [47] - Management expressed confidence in the ongoing growth opportunities in AI and enterprise markets [49] Other Important Information - Scott Herron, CFO, announced retirement at the end of fiscal year 2025, with Mark Patterson set to take over [21][22] - Cisco closed the acquisition of Snap Attack to enhance its security operations capabilities [29] Q&A Session Summary Question: Customer buying behavior amid tariff uncertainties - Management indicated no significant changes in purchasing behavior, with customers still committed to technology transitions [35][36] Question: Impact of cloud CapEx slowing down - Management does not anticipate a slowdown in global cloud CapEx, citing ongoing investments in sovereign cloud strategies [47][48] Question: AI orders and future growth rates - AI orders are expected to continue growing, with management emphasizing the need for execution and capacity increases [81][84] Question: Networking orders strength and product cycle contributions - Networking orders showed broad strength across various segments, with expectations for continued growth driven by product refresh cycles [70][71] Question: Tariff impact on guidance for Q4 - Management confirmed that the guidance for Q4 includes assumptions about tariffs, reflecting potential impacts on gross margins [106][107]

Company Overview - Proactive is a financial news publisher that provides fast, accessible, informative, and actionable business and finance news content to a global investment audience [2] - The company has a team of experienced news journalists who produce independent content across various financial markets [2] Market Focus - Proactive specializes in medium and small-cap markets while also covering blue-chip companies, commodities, and broader investment stories [3] - The content delivered includes insights across sectors such as biotech and pharma, mining and natural resources, battery metals, oil and gas, crypto, and emerging digital and EV technologies [3] Technology Adoption - Proactive is recognized for its forward-looking approach and enthusiastic adoption of technology to enhance workflows [4] - The company utilizes automation and software tools, including generative AI, while ensuring that all content is edited and authored by humans [5]

Financial Performance - Q3 FY 2025 revenue was $14.1 billion, an increase of 11% year over year, exceeding guidance[3] - GAAP net income reached $2.5 billion, up 32% year over year, with GAAP EPS of $0.62, a 35% increase[14] - Non-GAAP net income was $3.8 billion, an 8% increase year over year, with non-GAAP EPS of $0.96, a 9% increase[9] - Total revenue for the three months ended April 26, 2025, was $14,149 million, an increase of 11% year-over-year[33] - For the three months ended April 26, 2025, the total GAAP net income was $2,491 million, representing a 32% year-over-year increase[52] - Non-GAAP net income for the nine months ended April 26, 2025, was $11,262 million, slightly down from $11,619 million for the same period in 2024[46] - The company reported operating expenses of $18,837 million for the nine months ended April 26, 2025, which is a 14% increase compared to the previous year[55] Guidance and Projections - Q4 FY 2025 revenue guidance is projected between $14.5 billion and $14.7 billion, with GAAP EPS guidance of $0.62 to $0.67[20][21] - The guidance for Q4 FY 2025 indicates a GAAP gross margin of 64.5% - 65.5% and a non-GAAP gross margin of 67.5% - 68.5%[59] - The estimated non-GAAP earnings per share for FY 2025 is projected to be between $3.77 and $3.79[59] - The company expects to recognize 51% of total remaining performance obligations of $41,667 million as revenue over the next 12 months[40] Cash Flow and Assets - Cash flow from operating activities was $4.1 billion, a 2% increase compared to $4.0 billion in Q3 FY 2024[15] - Cash and cash equivalents increased to $8,161 million as of April 26, 2025, compared to $7,508 million as of July 27, 2024[36] - Net cash provided by operating activities for the nine months ended April 26, 2025, was $9,959 million, compared to $7,150 million for the same period in 2024[38] - Total assets decreased to $119,782 million as of April 26, 2025, down from $124,413 million as of July 27, 2024[36] - Total current liabilities decreased to $34,495 million as of April 26, 2025, from $40,584 million as of July 27, 2024[36] Shareholder Returns - Cisco returned $3.1 billion to stockholders through share buybacks and dividends in Q3 FY 2025[18] - Dividends paid in the quarter ended April 26, 2025, amounted to $1,627 million, with a per-share dividend of $0.41[44] Product and Market Performance - Product orders increased by 20% year over year, with AI Infrastructure orders exceeding $600 million[5] - Security revenue grew significantly by 54% year-over-year to $2,013 million for the three months ended April 26, 2025[33] - Total product revenue for the nine months ended April 26, 2025, was $30,722 million, reflecting a 5% increase year-over-year[33] Operational Insights - Total gross margin on a GAAP basis was 65.6%, compared to 65.1% in Q3 FY 2024[12] - The gross margin for products was 64.4% and for services was 68.7%, with a total gross margin of 65.6% for the same period[52] - The company incurred significant asset impairments and restructurings amounting to $34 million in the three months ended April 26, 2025[52] - The total adjustments to GAAP amounts for share-based compensation expense were $930 million for the three months ended April 26, 2025[52] - The company reported a year-over-year increase of 12% in non-GAAP operating income for the three months ended April 26, 2025[52] Strategic Initiatives - The acquisition of SnapAttack was completed in Q3 FY 2025, enhancing Cisco's threat detection capabilities[19] - Cisco emphasizes the importance of AI technologies and their impact on operational discipline and cash flow generation[61] - Cisco has been a technology leader for over 40 years, focusing on secure connections and AI-powered solutions to enhance productivity and digital resilience[67] Non-GAAP Measures - Cisco's management uses non-GAAP measures for internal budgeting, excluding items like share-based compensation and acquisition-related costs[66] - The company believes that non-GAAP measures provide useful insights into financial and business trends when presented alongside GAAP measures[65]

Core Insights - Cisco reported earnings and revenue that exceeded analysts' expectations, with revenue increasing by 11% year-over-year to $14.15 billion and net income rising to $2.49 billion, or 62 cents per share [1][5] - The company provided guidance for fiscal 2025, projecting earnings per share between 96 cents and 98 cents on revenue of $14.5 billion to $14.7 billion, surpassing analyst predictions [2] Financial Performance - Revenue for the quarter ending April 26 was $14.15 billion, up from $12.7 billion a year earlier, while net income increased from $1.89 billion to $2.49 billion [1] - Adjusted earnings per share were reported at 96 cents, slightly above the expected 92 cents [5] Business Segments - Networking revenue rose by 8% to $7.07 billion, exceeding the expected $6.81 billion [4] - Security product revenue surged by 54% to $2.01 billion, although it fell short of the $2.17 billion consensus [4] Strategic Initiatives - Cisco secured over $600 million in artificial intelligence infrastructure orders from web companies, totaling over $1.25 billion for the fiscal year, surpassing the $1 billion mark ahead of schedule [3] - The company launched a Webex AI agent for customer service and introduced Ethernet switches with AMD Pensando data processing units [3]

SAN JOSE, Calif., May 14, 2025 /PRNewswire/ --News Summary: Product orders up 20% year over year; up 9% excluding Splunk, with growth across all geographies and customer markets AI Infrastructure orders taken from webscale customers exceeded $600 million, surpassing our $1 billion target one quarter early Revenue of $14.1 billion, up 11% year over year, above the high end of our guidance range Strong profitability with GAAP and non-GAAP margins and EPS above the high end of our guidance range Q3 FY 2025 Res ...

Cisco Systems Inc CSCO will report its third-quarter earnings Wednesday after the market close, with Wall Street expecting earnings per share of 92 cets and revenue of $14.08 billion.The stock has climbed 25.4% over the past year, despite being down 3.87% year-to-date and slipping 6.92% in the past month. However, over the last five trading days, Cisco stock has regained 2.53%, and a confluence of bullish technical signals suggests momentum may just be heating up.Let's take a look at what's propelling Cisco ...