Earnings Results: Cisco stock drops as outlook comes in below Street expectations

This post was originally published on this site

Cisco Systems Inc. may have topped analyst expectations for the most recently completed quarter late Wednesday, but the networking giant’s weak outlook weighed on shares after hours.

Cisco CSCO, +0.19%  shares dropped 5.5% after hours, following a 0.2% rise in the regular session to close at $48.46.

Cisco expects adjusted fiscal second-quarter earnings of 75 cents to 77 cents a share on a 5% to 3% decline in year-over-year revenue. Analysts surveyed by FactSet expect earnings of 79 cents a share and revenue of $12.75 billion, which would be a 2.4% increase from the year-ago quarter.

Read: Cisco earnings: results from the network-gear maker may refresh fears of a tech-spending slowdown

The company reported fiscal first-quarter net income of $2.93 billion, or 68 cents a share, compared with $3.55 billion, or 77 cents a share, in the year-ago period. Adjusted earnings were 84 cents a share.

Revenue rose to $13.16 billion from $13.07 billion in the year-ago quarter.

Analysts had forecast earnings of 81 cents a share on revenue of $13.08 billion.

As of the close, shares are up nearly 12% this year, as the S&P 500 index SPX, +0.07% has gained 23% and the Dow Jones Industrial Average DJIA, +0.33% — which counts Cisco as a component — has increased 19%.

Of the 28 analysts who cover Cisco, 16 have an overweight or buy rating on the stock and 12 have a hold ratings, with an average price of $54.91.