Cisco Systems Inc. (NASDAQ:CSCO) will be reporting its earnings of the 2nd quarter of the fiscal2015 later today, after the closing of the markets. The earnings report is anxiously awaited by the analysts as well as the investors who will also be looking at the company’s stock. It is expected that the company’s quarterly results will be positive. The company’s investors were disappointed by the revenues generated in the first quarter of the fiscal 2015; however, this time around it is speculated that the company will be able to generate promising results.
Cisco is a San Jose, California based networking company which was founded in 1984 and it has been trying to gain revenues amid the emerging markets related to wireless systems as well as data center items. In the fiscal 2015’s first quarter, Cisco saw a year over year increase of just 1% at $12.2 billion. This exceeded the expectations of both the analysts as well as the company’s guidance.
The company’s net income saw a year over year decline of 2% at $1.8 billion. Cisco is currently going through a tough time as the competitive market of other countries like India, Brazil and Russia as well as China is economizing by restricting their budget on networking equipment. Cisco (NASDAQ:CSCO) has been able to perform well in the US market; the unstable currency has affected the company, however, the affect is expected to be short term.
Cisco (NASDAQ:CSCO) is also working towards monetizing the transition in routers as well as switches along with upgrading the cloud systems as the company has already received some big orders. Jason Ader, an analyst at William Blair & Co. said that Cisco’s security measures are attracting more re-sellers and the company is offering a firewall which is competitive and efficient.
Cisco (NASDAQ:CSCO) focused on its software as well as services, the company also improvised on its cloud offerings and all of these things helped the company to stay ahead of the market. Moreover, the company also worked towards cutting costs as well as jobs. In the previous year, 6,000 jobs were cut down by the company in an effort to retain its margins. More cost cutting steps are expected to be announced by the company today.
The company expects that in the 2nd quarter of fiscal 2015, there will be a revenue increase of 4-7%. The company’s gross margin is said to be between 61-62% while the price-to-earnings ratio of the company is expected to increase 9% year over year. As of now, a lot is going on with Cisco (NASDAQ:CSCO); the company is facing difficult market conditions along with unstable currency.
On top of that, it has filed a case against Arista Networks Inc. which is active and ongoing. However, despite the condition, Cisco has been able to attract see-side attention towards itself. As per Bloomberg, 28 analysts have given the company’s stock a Buy rating. 14 analysts gave it a Hold while 6 gave the company’s stock a Sell rating. The company’s 12 month target price on its stock is $28.42.
