Revenue fell to US$12.64 billion from US$12.84 billion.
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Cisco will report earnings today after the market closes, and that would be the next opportunity.
“We had another strong quarter, wrapping up a great year”, Cisco CEO Chuck Robbins said in a statement.
Cisco Systems Inc. finished off its fiscal year with an earnings beat, the networking giant announced Wednesday, but it also announced a restructuring that will include the elimination of 5,500 jobs.
However, the company’s net profit rose to $2.81 billion, or 56 cents per share, in the fourth quarter ended July 30, from $2.32 billion, or 45 cents per share, a year earlier.
Earlier unconfirmed reports on Bloomberg said that Cisco would lay off 14,000 jobs; the company later said it was laying off 5000 employees. “Cisco provides impacted role numbers as required by local laws and regulations”, said Robyn Blum, Cisco Communications. Revenue for the current quarter (1QFY2017) is expected to increase or decrease by 1 percent year-over-year.
Cisco said the restructuring will help the company to “optimize cost base in lower growth areas of its portfolio and further invest in key priority areas such as security, IoT, collaboration, next generation data center and cloud”. The company generated $10.7 billion in net income in 2016, an increase of $1.7 billion compared with a year ago, and has about $60.4 billion in cash.
The same can be said for its services business, which includes product support and management. The company serves businesses of various sizes, public institutions, governments, and communications service providers.
Cisco shares were mostly flat in aftermarket trading on Wednesday at $30.72. In February, Yahoo announced it is trimming 15 percent of its workforce, or 1,600 employees; AutoDesk is eliminating 10 percent of its workforce, or 925 employees; and NetApp announced cutbacks of 12 percent of its workforce, or 1,500 employees. “Our product deferred revenue from software and subscriptions grew 33 percent showing the continued momentum of our business model transformation”.
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Global Equities Research analyst Trip Chowdhry believes that Cisco is “just buying time” with its re-focusing of resources and that more job cuts are on the horizon.
