Cisco reported a strong start to its fiscal year, with revenue in the October quarter up 8 percent year-on-year to USD 13.1 billion. Net profit rose 48 percent to USD 3.5 billion, and EPS jumped 60 percent to USD 0.77. The results were better than the company's guidance.
Cisco said product revenue rose 9 percent and service revenue was up 3 percent. Product revenue performance was generally broad based, with Applications up 18 percent, Security up 11 percent and Infrastructure Platforms growing 9 percent. APAC was the strongest geographic segment with sales growth of 12 percent, followed by EMEA up 11 percent and 5 percent growth in the Americas.
The company's gross margin improved to 62.3 percent from 61.2 a year ago. After a 7 percent reduction in operating costs, the operating profit rose 38 percent to USD 3.8 billion.
Cisco generated operating cash flow of USD 3.8 billion, up 22 percent year-on-year. That includes USD 0.4 billion from Arista Networks to settle their legal dispute. Cisco ended the period with total cash and equivalents of USD 42.6 billion, down from USD 46.5 billion three months earlier, after the company spent USD 6.5 billion on dividends and share buybacks in the quarter.
For fiscal Q2, Cisco forecast revenues up 5-7 percent year-on-year and EPS of USD 0.56-0.61.
