Cisco Reports First Quarter Fiscal 2025 Financial Results

Cisco Reports First Quarter Fiscal 2025 Financial Results

San Jose, Calif., Nov. 13, 2024 — Cisco Systems, Inc. announced its financial results for the first quarter of fiscal year 2025, ending October 26, 2024, highlighting robust operational performance despite year-over-year declines in key metrics.

Key Financial Metrics

Cisco's first-quarter revenue was $13.8 billion, achieving the high end of its guidance range and slightly exceeding Wall Street estimates. Despite this, the figures represent a 6% year-over-year decrease, reflecting challenges in the broader market. Non-GAAP EPS of $0.91 surpassed consensus estimates and last year's performance, showcasing Cisco's strong operational management.

Revenue by Segment

Cisco's revenue diversity reflected contrasting performances across segments, with robust growth in Security and Observability offset by declines in Networking and Collaboration. Notably, excluding contributions from Splunk, Security grew by 2% and Observability by 1% year-on-year, indicating underlying strength beyond acquisitions.

Key Developments and Operational Highlights

• Cisco achieved a GAAP gross margin of 65.9% and a non-GAAP gross margin of 69.3%, both exceeding the company’s guidance.
• Cash flow from operating activities reached $3.7 billion, marking a 54% increase compared to the previous year.

Executive Commentary

CEO Chuck Robbins emphasized Cisco's strategic advantage in infrastructure investment amid rising AI technologies, citing the company's wide-ranging portfolio. CFO Scott Herren credited revenue, gross margin, and EPS success as indicative of strong operational leverage and discipline.

Capital Allocation and Share Repurchase Program

Cisco returned $3.6 billion to stockholders through dividends and stock repurchases, declaring a quarterly dividend of $0.40 per share, to be distributed on January 22, 2025. Approximately 40 million shares were repurchased, with $3.2 billion remaining under the repurchase program.

Forward Guidance

Cisco projects Q2 FY 2025 revenue between $13.75 billion and $13.95 billion, with GAAP EPS expected between $0.51 and $0.56. For the full fiscal year 2025, Cisco anticipates revenue between $55.3 billion and $56.3 billion and non-GAAP EPS ranging from $3.60 to $3.66.

Market Reaction

Following the earnings announcement, Cisco's stock price experienced a positive movement, with the price increasing by 0.92%.

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