Shulou(Shulou.com)11/24 Report--

In the early morning of August 18, Beijing time, Cisco today released the company's fourth quarter and full-year results for fiscal 2022. According to the report, Cisco's fourth-quarter net revenue was $13.102 billion, basically unchanged from $13.126 billion in the same period last year; net profit was $2.8 billion, down 6% from $3 billion in the same period last year; net profit, which is not in accordance with US GAAP, was $3.4 billion, down 3 per cent from $3.6 billion in the same period last year.

Cisco's fourth-quarter revenue and adjusted earnings per share exceeded Wall Street analysts' expectations, and its outlook for revenue for the first quarter of fiscal 2023 and for the whole of fiscal 2023 also exceeded expectations, sending its shares up nearly 5 per cent in after-hours trading.

Financial report for the fourth quarter of fiscal year 2022:

Net profit:

In the quarter ended July 30, 2022, Cisco's net profit was $2.8 billion, down 6 per cent from $3 billion a year earlier. According to general accounting standards, Cisco earned 68 cents per share in the fourth quarter, down 4% from a year earlier. In the fourth quarter of fiscal 2021, Cisco earned 71 cents per share.

Excluding some one-time items (not in accordance with GAAP), Cisco's adjusted net income for the fourth quarter was $3.4 billion, down 3% from $3.6 billion a year earlier; adjusted earnings per share was 83 cents, down 1% from 84 cents a year earlier, but the performance still exceeded analysts' expectations. On average, 23 analysts had expected Cisco to earn 82 cents a share in the fourth quarter, according to data provided by Yahoo Finance.

Revenue:

Cisco's fourth-quarter net revenue was $13.102 billion, roughly flat from $13.126 billion a year earlier and exceeding analysts' expectations. On average, 21 analysts had expected Cisco's fourth-quarter revenue to reach $12.73 billion, according to Yahoo Finance.

In the fourth quarter of fiscal 2022, sales of Cisco products (including routers and switches) were $9.688 billion, compared with $9.716 billion in the same period last year, which was basically flat, while sales of services were $3.414 billion, compared with $3.41 billion in the same period last year.

In the product business, Cisco's revenue from security and Agile Networks in the third quarter was $6.094 billion, down 1% compared with the same period last year; revenue from Internet for the Future business was $1.257 billion, down 10% from the same period last year; revenue from cooperative business was $1.164 billion, up 2% from the same period last year Revenue from the end-to-end security business was $984 million, up 20% from the same period last year; revenue from optimized application experience was $185 million, up 8% from the same period last year; and revenue from other products was $3 million, down 22% from the same period last year.

Revenue from the Americas was $7.47 billion, down 3% from the same period last year; revenue from the EMEA (Europe, Middle East, and Africa) region was $3.577 billion, up 8% from the same period last year; and revenue from the APJC (Asia Pacific, Japan, and Greater China region) was $2.055 billion, down 2% from the same period last year.

Gross profit margin:

Cisco's total fiscal fourth quarter gross margin, product gross margin and service gross margin were 61.3%, 59.1% and 67.5%, respectively, compared with 63.6%, 62.7% and 66.2% in the same period last year. Not in accordance with US general accounting standards, Cisco's adjusted gross profit margin and product gross profit margin in the fourth quarter were 63.3%, 61.3% and 69.0%, respectively, compared with 65.6%, 65.0% and 67.4% in the same period last year.

By region, the gross profit margin of Cisco's business in the Americas in the fourth quarter was 62.6%. The gross profit margin of the business in the Magi EMEA (Europe, Middle East and Africa) region was 64.4%. The gross profit margin of the APJC (Asia Pacific, Japan and Greater China) region was 63.6%.

Operating expenses and operating profit:

Cisco's total operating expenses in the fourth quarter were $4.591 billion, down 4% from $4.769 billion a year earlier and accounting for 35.0% of revenue. Of this total, Cisco's fourth quarter R & D expenditure was $1.682 billion, compared with $1.713 billion in the same period last year; sales and marketing expenses were $2.349 billion, compared with $2.448 billion in the same period last year; general and administrative expenses were $489 million, compared with $521 million in the same period last year; and amortization of intangible assets was $7300, compared with $7900 in the same period last year. Restructuring and other expenses were-$2 million, compared with $8 million in the same period last year. Without GAAP, Cisco's adjusted total operating expenses for the fourth quarter were $4.1 billion, down 4% from a year earlier and accounting for 32.4% of revenue.

Cisco's fourth-quarter operating profit was $3.4 billion, down 4% from a year earlier, with an operating margin of 26.2%. Not in accordance with GAAP, Cisco's adjusted operating profit for the fourth quarter was $4.2 billion, down 4% from a year earlier, and an adjusted operating margin of 32.4%.

Cash flow, balance sheet and other financial information:

Cisco's operating cash flow was $3.7 billion in the fourth quarter of fiscal 2022, down 18 percent from $4.5 billion in the fourth quarter of fiscal 2021. Cisco's cash, cash equivalents and investments totaled $19.3 billion at the end of fiscal fourth quarter, compared with $20.1 billion at the end of fiscal third quarter 2022 and $24.5 billion at the end of fiscal fourth quarter 2021.

Cisco's reserve income tax rate for the fourth fiscal quarter is 17.6%, and the reserve income tax rate that is not in accordance with GAAP is 18.5%.

Cisco's deferred revenue for the fourth quarter was $23.3 billion, up 5 per cent from a year earlier. Among them, product deferred revenue increased by 11% over the same period last year, and service deferred revenue increased by 1% compared with the same period last year.

Capital return Plan:

During the quarter, Cisco announced and paid a cash dividend of 38 cents per common share for a total expense of $1.6 billion, and repurchased approximately 54 million common shares at an average repurchase price of $44.02 per share and a total repurchase price of $2.4 billion. Cisco returned a total of $4 billion in cash to shareholders during the quarter in the form of dividends and share buybacks. According to Cisco's share buyback program, the company's remaining authorized repurchase amount is $15.2 billion with no expiration date.

Key points of annual results:

Cisco's net revenue for fiscal 2022 was $51.6 billion, up 3% from $49.8 billion in fiscal 2021 and exceeding analysts' expectations. On average, 27 analysts had expected Cisco's full-year net revenue to reach $51.18 billion, according to Yahoo Finance.

Under GAAP, Cisco's net profit for fiscal 2022 was $11.8 billion, compared with $10.6 billion in fiscal 2021, up 12% from a year earlier; earnings per share were $2.82, compared with $2.50 in fiscal 2021, up 13% from a year earlier.

Excluding certain one-time items (not in accordance with GAAP), Cisco's adjusted net profit for fiscal 2022 was $14.1 billion, up 3% from $13.6 billion in fiscal 2021, and earnings per share was $3.36. up 4% from $3.22 in fiscal 2021 and exceeding analysts' expectations. On average, 27 analysts expected Cisco's full-year adjusted earnings per share to reach $3.35, according to data provided by Yahoo Finance.

For the entire fiscal year 2022, Cisco's operating cash flow was $13.2 billion, down 14% from fiscal year 2021.

Performance outlook:

Cisco expects revenue to grow by 2% to 4% in the first quarter of fiscal 2023 compared with the same period last year; gross profit margins that are not in accordance with GAAP are 63% to 64%, operating margins that are not in accordance with GAAP are 31.5% to 32.5%, and earnings per share, which are not adjusted for GAAP, are between 82 and 84 U.S. dollars, with a value of 83 cents, slightly lower than analysts' expectations. According to previous results released by Cisco, the company's revenue in the first quarter of fiscal 2022 was $12.9 billion, which means that Cisco expects revenue in the first quarter of fiscal 2023 to reach between $13.158 billion and $13.416 billion, which exceeds analysts' expectations.

According to data provided by Yahoo Finance Channel, 20 analysts on average expect Cisco's first-quarter revenue to reach $12.82 billion, while 22 analysts expect Cisco's first-quarter earnings per share to reach 84 cents.

Cisco also expects revenue to grow 4% to 6% year-on-year in fiscal 2023, and earnings per share that are not in accordance with GAAP will reach $3.49 to $3.56, with an average of $3.525 slightly below analysts' expectations. Cisco's net revenue for fiscal 2022 was $51.6 billion, which means the company expects net revenue of between $53.664 billion and $54.696 billion in fiscal 2023, exceeding analysts' expectations.

According to data provided by Yahoo Finance, 26 analysts on average expect Cisco's revenue to reach $52.79 billion in fiscal 2023, and 26 analysts expect Cisco's adjusted earnings per share to reach $3.53 in fiscal 2023.

Stock price response:

On the day, Cisco shares fell 11 cents, or 0.24 percent, to $46.66 in regular Nasdaq trading. Cisco shares jumped $2.23, or 4.78 per cent, to $48.89 in after-hours trading as of 05:15 EDT on Wednesday (05:15 Beijing time on Thursday). In the past 52 weeks, the highest price for Cisco is $64.29 and the lowest price is $40.82.

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