Cisco Systems (NASDAQ:CSCO) shares plummeted 10% in Thursday’s early deals after the company guided weaker-than-expected sales and profits for the current quarter.
For 2Q fiscal 2024, the networking, cloud and security solutions provider guided revenue in the range of $12.6 billion to $12.8 billion, significantly lower than the Wall Street forecast of $14.15 billion.
It projected earnings per share in the range of $0.82 and $0.84, below estimates of $0.98.
The company’s full-year guidance was also short of expectations. It forecast revenue in the range of $53.8 billion to $55 billion and adjusted EPS between $3.87 and $3.93, below expectations of $57.7 billion in revenue and $4.05 in adjusted EPS.
Its 1Q earnings, however, topped estimates on the top and bottom lines.
Revenue rose 8% year-over-year to $14.7 billion: a company record and ahead of estimates of $14.61 billion. Both software and subscription revenue rose 13% over the year-ago quarter.
Adjusted EPS of $1.11 was up 29% year-over-year and topped forecasts of $1.03.
"We had a solid start to fiscal 2024 with the strongest 1Q results in our history on both revenue and profitability," Cisco CEO Chuck Robbins said in a statement.
"We are confident in the foundational strength of our business and future growth opportunities fueled by AI, Security, Cloud, and Observability."
Cisco shares traded down 9.6% at US$48.18 shortly following the release of its 1Q earnings report.
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