Cisco Systems (CSCO) to Report Q4 Earnings

The company anticipates fourth-quarter fiscal 2022 revenues to decline in the range of 1-5.5% on a year-over-year basis. Non-GAAP earnings are anticipated to be between 76 and 84 cents per share.

The Zack’s Consensus Estimate for revenues is pegged at $12.75 billion, indicating a decrease of 2.85% over the year-ago quarter’s reported figure.

The consensus mark for earnings has been stable in the past 30 days at 82 cents per share. The figure suggests a decline of 2.38% from the prior-year quarter’s levels.

Let’s see how things have shaped up for Cisco prior to this announcement.

Factors Likely to Influence Q4 Results

Cisco’s fourth-quarter fiscal 2022 results are expected to suffer from supply chain constraints related to certain components due to COVID-related lockdowns in China as well as the negative impact of the ongoing war between Russia and Ukraine.

In March, Cisco stopped business operations in both Russia and Belarus. This move negatively impacted revenues by $200 million in the fiscal third quarter.

However, Cisco’s extensive product portfolio and the varied end-user base are expected to have positively contributed to the fiscal fourth-quarter top-line growth.

Cisco has raised the prices of its solutions a couple of times in the past eight months. Higher prices are expected to have somewhat offset inflation, thereby driving fiscal fourth-quarter top-line growth.

Cisco’s revenues are likely to have benefited from momentum in web-scale, servers, wireless, security and SD WAN businesses. The company has been benefiting from ongoing investments that its customers are making to rapidly digitise their organisations.

Higher bandwidth requirements by customers are expected to have driven demand for Acacia’s optical solutions in the to-be-reported quarter.

What Our Model Says
Per the Zack’s model, the combination of a positive Earnings ESP and a Zack’s Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Cisco has an Earnings ESP of 0.00% and carries a Zack’s Rank #3 currently. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.