Networking hardware and software manufacturer Cisco Systems reported first-quarter earnings for fiscal 2025 that beat the estimates of analysts while also raising annual guidance. However, the company’s stock still slipped 2.5% in aftermarket trading as investors were not thrilled with its declining revenue.
Cisco reported revenue of $13.84 billion, which was better than the $13.77 billion expected by analysts. However, the figure was below the $14.7 billion reported in the same period last year while marking the fourth straight quarter of declining revenue. It also had adjusted earnings per share of $0.91 cents versus estimates of $0.87 cents.
Still, the company expects to bounce back as soon as the current quarter, thanks to massive demand for artificial intelligence infrastructure. Cisco’s networking equipment is a crucial component of large data centers that supply the computing power for AI technology.
“Cisco is off to a strong start to fiscal 2025. Our customers are investing in critical infrastructure to prepare for AI, and with the breadth of our portfolio,” CEO Chuck Robbins said in a statement.
Cisco now expects to see sales between $13.75 billion and $13.95 billion in the second quarter of fiscal 2025, while analysts expect $13.74 billion. Additionally, it raised its previous annual revenue forecast of between $55.0 billion and $56.2 billion and now projects sales in the range of $55.3 billion and $56.3 billion.
Cisco stock closed at $59.18 per share on Wednesday, being 17.16% up year-to-date. After the dip, the stock traded at $57.68 per share.