CISCO REPORTS THIRD QUARTER EARNINGS

Core Insights - Cisco reported strong third quarter results for FY 2025, with revenue of $14.1 billion, a year-over-year increase of 11%, and net income of $2.5 billion, reflecting a 32% increase compared to the same quarter last year [2][10][11]. Financial Performance - Revenue: Total revenue reached $14.1 billion, up 11% from $12.7 billion in Q3 FY 2024. Product revenue increased by 15%, while services revenue grew by 3% [4][7]. - Net Income: GAAP net income was $2.5 billion, or $0.62 per share, marking a 32% increase in net income and a 35% increase in EPS compared to Q3 FY 2024 [10][11]. - Non-GAAP Results: Non-GAAP net income was $3.8 billion, an 8% increase year-over-year, with non-GAAP EPS at $0.96, a 9% increase [5][10]. Margins and Expenses - Gross Margin: GAAP gross margin was 65.6%, slightly up from 65.1% in Q3 FY 2024. Non-GAAP gross margin was 68.6%, compared to 68.3% in the same period last year [8][10]. - Operating Expenses: GAAP operating expenses were $6.1 billion, flat year-over-year, while non-GAAP operating expenses increased by 12% to $4.8 billion [9][10]. Geographic and Product Performance - Geographic Revenue: Revenue by region showed growth: Americas up 14%, EMEA up 8%, and APJC up 9% [7][23]. - Product Performance: Notable growth in product categories included Security (up 54%), Observability (up 24%), Networking (up 8%), and Collaboration (up 4%) [7][25]. Cash Flow and Capital Allocation - Cash Flow: Operating cash flow for Q3 FY 2025 was $4.1 billion, a 2% increase from $4.0 billion in Q3 FY 2024 [12]. - Capital Return: Cisco returned $3.1 billion to shareholders through dividends and share repurchases, including a declared dividend of $0.41 per share [15][33]. Guidance - Q4 FY 2025 Guidance: Cisco expects revenue between $14.5 billion and $14.7 billion, with GAAP EPS projected between $0.62 and $0.67 [11][17]. - FY 2025 Guidance: Full-year revenue is anticipated to be between $56.5 billion and $56.7 billion, with GAAP EPS expected between $2.53 and $2.58 [11][18].