Cisco Systems Inc (NASDAQ: CSCO) shares tanked 18% in extended trading on weaker-than-expected Q3 revenue and disappointing guidance for the future.
Key takeaways from Cisco Q3 results
Net income printed at $3.04 billion versus the year-ago figure of $2.86 billion.
Per-share earnings of 73 cents were better than 68 cents in Q3 of previous year.
On an adjusted basis, EPS stood at 87 cents, as per the earnings press release.
Revenue remained roughly flat at $12.84 billion in the recent fiscal quarter.
FactSet consensus was for 86 cents of adjusted EPS on $13.37 billion in revenue.
Product order growth and ARR jumped 8.0% and 11% in Q3, respectively.
According to CEO Chuck Robbins, demand remains strong and the hit to Q3 revenue was related to the ongoing war in Ukraine and the COVID lockdowns in China. The stock is now down more than 35% for the year.
Future guidance and CEO’s remarks
Cisco warned on Wednesday that its revenue could slide by up to 5.5% in the current financial quarter. It also lowered its full-year guidance for revenue to a 2.0% to 3.0% growth versus up to 6.5% increase it had forecast earlier.
The San Jose-headquartered company expects its fiscal 2022 EPS to fall in the range of $2.75 to $2.85. In the earnings press release, the chief executive said:
Our business transformation is progressing well. The fundamental drivers across our business are strong and we remain confident in the long term.