Worldâ€™s largest computer networking equipment maker, Cisco Systems Inc. (NASDAQ: CSCO) announced better-than-expected fourth-quarter results despite businesses and government spending falling sharply in the wake of economic slowdown. The company also increased its dividends.
For the quarter, Cisco reported that sales increased by 4.4% compared to the year earlier quarter. In the long-term, the company expects to grow by 5% to 7%, annually.
The company said that earnings for the fourth quarter stood at $1.9 billion or 36 cents a share which is a 56 percent jump from $1.2 billion, or 22 cents per share, in the corresponding period of the last year.
After excluding the stock-based compensation, restructuring costs and some other onetime expenses, earnings stood at 47 cents a share, up from 40 cents a share in the year earlier quarter.Â Analysts polled by FactSet Research had forecasted earnings of 45 cents a share, after excluding restricting costs, onetime expenses and stock based compensation.
Revenue for the period stood at $11.7 billion compared to year earlier quarterâ€™s $11.2 billion. The revenue also beat the Streetâ€™s expectations.
On geographical basis, sales in the Americas rose by 7%, even as it fell in the Europe, the Middle East and Africa by about 5%.
However, companyâ€™s smallest revenue segment, the East Asia region saw sales climbing by 9% for the quarter.
Among Ciscoâ€™s product segments, sales of its switches and routers were in line with expectations, while those of cable-TV equipment and corporate videoconferencing setups fell in the fourth quarter.
For the current quarter, the company expects revenue to come in between $11.5 billion and $11.9 billion while analystsâ€™ consensus estimate is for $11.7 billion. The Company believes that sales from NDS, a video-equipment company recently acquired will help boosting sales.
Meanwhile, the company has also raised its dividends by 75% to 14 cents for the quarter-which is an annual yield of 3.2% on Ciscoâ€™s stock valuation and much higher compared to industryâ€™s average.
Following the earnings announcement, shares of San Jose California based company jumped in trading on Thursday. The stock ended 9.63% higher at $19.02.