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Cisco Earnings Preview: AI Momentum Meets 63% Odds Of A Stock Jump
Forbesยท 2025-08-13 11:10
Core Insights - Cisco Systems Inc is expected to report fiscal fourth-quarter earnings on August 13, 2025, with analysts predicting earnings of 98 cents per share and revenue of $14.62 billion, reflecting a 13% increase in adjusted earnings and a 7% rise in sales year-over-year [2] - The company's Q3 results exceeded expectations, driven by strong AI-related demand, which positively impacted core earnings and full-year targets [2] - Cisco's stock has historically outperformed after earnings announcements, with a 63% chance of positive returns and a median one-day gain of 4.3% [4] Financial Performance - Cisco's market capitalization stands at $281 billion, with total revenue over the past twelve months reaching $56 billion [2] - The company reported $12 billion in operating profits and a net income of $9.8 billion [2] Historical Earnings Trends - Over the past five years, Cisco has recorded 19 earnings data points, with 12 positive and 7 negative one-day returns, indicating a 63% likelihood of positive returns [4] - This percentage increases to 67% when considering data from the last three years [4] - The median of positive returns is 4.3%, while the median of negative returns is -2.7% [4] Correlation Analysis - Analyzing the correlation between short-term and medium-term returns can provide a less risky trading strategy, particularly if a high correlation exists between 1D and 5D returns [5] - Historical data suggests that peer performance can influence Cisco's post-earnings reactions, with pricing potentially starting before earnings announcements [6]