Cisco Systems (NASDAQ:CSCO) shares climbed more than 5% Thursday as investors threw their support behind the networking equipment giant following its upbeat quarterly results and forecast.
Late Wednesday, Cisco (CSCO) said that it expects its fiscal third-quarter earnings, excluding one-time items, of between 96 cents and 98 cents a share, with revenue rising 11% to 13% from a year ago. For its full fiscal year, Cisco (CSCO) forecast earnings of $3.73 to $3.78 a share, after earlier pegging its earnings to a range of $3.51 to $3.58 a share. The company also estimates sales for the year will grow between 9% and 10.5% over its 2022 fiscal year.
In addition to its outlook, Cisco (CSCO) reported second-quarter earnings of 88 cents a share on $13.6B in revenue, which topped analysts’ forecasts for a profit of 86 cents a share on sales of $13.41B.
While initial reaction on Wall Street toward Cisco (CSCO) was positive, some analysts cautioned about the company’s order backlog. George Notter, of Jefferies, said that investors should put Cisco’s (CSCO) guidance into “perspective given the supply chain normalization going on.”
Notter estimated that Cisco’s (CSCO) backlog during the second quarter was approximately $14B, or about twice its normal levels.