Cisco shares jumped in pre-market trading after the company reported market-beating earnings, raised its guidance and changed its pricing model to help ease volatile hardware component costs.
Shares were up 16% at $118.85 in pre-market trading.
The technology conglomerate said late Wednesday that it saw increased demand for artificial intelligence and other technology infrastructure. Total product orders rose 35% in the third quarter of the fiscal year.
The company saw double-digit increases in all geographic segments and the rates are accelerating, Chief Financial Officer Mark Patterson said on a call with analysts.
It now forecasts revenue for the year ending in July to be between $62.8 billion and $63 billion, compared with $61.2 billion to $61.7 billion as guided for in February.
The company also lowered the notice period for price increases to 15 days, from 30 days, and reduced the validity period of old price quotes to 15 days from 20 to 45 days. The moves protect Cisco's margins from exposure to cost increases.
"[We] basically cut the time in half or maybe even a little bit better, and that's really helped us," Patterson said.
Write to Julia Fadi Nasser at julia.nasser@wsj.com
Mr. Mark R. Patterson is a Lead Independent Director at Paramount Group, Inc., a Chairman-Trustees Board at Americold Realty Trust, Inc., an Independent Director at Digital Realty Trust, Inc., an Independent Director at UDR, Inc., a President & Director at MP Realty Advisors LLC, a Chairman at NorthEnd Income Property Trust, Inc., a Member at The American Institute of Certified Public Accountants, a Member at The Real Estate Roundtable, a Member at The Urban Land Institute and a President at MRP Holdings LLC. He is on the Board of Directors at Paramount Group, Inc., Digital Realty Trust, Inc., UDR, Inc., MP Realty Advisors LLC, Digital Realty Trust LP and United Dominion Realty LP. Mr. Patterson was previously employed as an Independent Director by GGP, Inc., a Chairman by Boomerang Systems, Inc., a MD & Head-Real Estate Global Principal Investments by Merrill Lynch & Co., Inc. /Old/, an Associate-Real Estate Investment Banking Group by Chemical Realty Corp., a Head-Real Estate Investment Banking by Citigroup, Inc., an Auditor-Real Estate Division by Arthur Anderson & Co., and a Member-Governors Board by National Association of Real Estate Investment Trusts, Inc. He also served on the board at Investcorp Holdings BSC. He received his undergraduate degree from The College of William & Mary and an MBA from the University of Virginia Darden School of Business.
Cisco Systems, Inc. is the world leader in designing, developing, and marketing Internet network equipment. Net sales break down by family of products and services as follows:
- network equipment (59.1%); switches and routers, technological software and systems (storage, Internet access, and security systems, wiring, gateways, connection interfaces and modules, etc.), etc.;
- services (26.6%): technical assistance, network design, execution, and integration services, etc.;
- security products (14.3%).
Net sales are distributed geographically as follows: Americas (59.4%), Europe/Middle East/Africa (26.2%) and Asia/Pacific (14.4%).
This super rating is the result of a weighted average of the rankings based on the following ratings: Valuation (Composite), EPS Revisions (4 months), and Visibility (Composite). We recommend that you carefully review the associated descriptions.
Investor
Investor
This super composite rating is the result of a weighted average of the rankings based on the following ratings: Fundamentals (Composite), Valuation (Composite), EPS Revisions (1 year), and Visibility (Composite). We recommend that you carefully review the associated descriptions.
Global
Global
This composite rating is the result of an average of the rankings based on the following ratings: Fundamentals (Composite), Valuation (Composite), Financial Estimates Revisions (Composite), Consensus (Composite) and Visibility (Composite). The company must be covered by at least 4 of these 5 ratings for the calculation to be carried out. We recommend that you carefully review the associated descriptions.
Quality
Quality
This composite rating is the result of an average of rankings based on the following ratings: Returns (Composite), Profitability (Composite) and Quality of Financial Reporting (Composite), and Financial Health (Composite). The company must be covered by at least 2 of these 3 ratings for the calculation to be performed. We recommend that you carefully read the associated descriptions.
ESG MSCI
ESG MSCI
The MSCI ESG score assesses a company’s environmental, social, and governance practices relative to its industry peers. Companies are rated from CCC (laggard) to AAA (leader). This rating helps investors incorporate sustainability risks and opportunities into their investment decisions.
![Mark Patterson](data:image/svg+xml,<svg xmlns="http://www.w3.org/2000/svg" width="16" height="16" fill="%231b1b1b" class="bi bi-person-fill" viewBox="0 0 16 16"><path d="M3 14s-1 0-1-1 1-4 6-4 6 3 6 4-1 1-1 1zm5-6a3 3 0 1 0 0-6 3 3 0 0 0 0 6"/></svg>)
