Cisco reported revenue of $12.7 billion for its third fiscal quarter, ended April 27, 2024, down 13%, with product revenue down 19% and service revenue up 6%. Cisco completed the acquisition of Splunk during the quarter. Splunk contributed $413 million of total revenue for the third quarter of fiscal 2024.
Net income on a generally accepted accounting principles (GAAP) basis was $1.9 billion or $0.46 per share, and non-GAAP net income of $3.6 billion or $0.88 per share.
"We delivered a solid Q3 performance in what remains a dynamic environment" said Chuck Robbins, chair and CEO of Cisco. "Our unique ability to bring together networking, security, observability, and data enables Cisco to offer our customers unrivaled digital resilience for the AI era."
"Revenue, gross margin and non-GAAP EPS in Q3 were at the high end or above our guidance range, both including and excluding Splunk, resulting in continued operating leverage," said Scott Herren, CFO of Cisco. "Customers are consuming the equipment shipped over the last few quarters in line with our expectations and we are seeing stabilization of demand as a result. The addition of Splunk to our product line will be a catalyst for further growth."
In addition, Cisco named Gary Steele as President of Go-to-Market, effective immediately. He will continue to lead the Splunk team through the integration process to ensure a seamless integration into Cisco.
Some highlights
- Strong profitability with GAAP gross margin of 65.1% and non-GAAP gross margin of 68.3%
- Transformed business model, further enhanced by the Splunk acquisition:
- Total subscription revenue of $6.9 billion including Splunk, representing 54% of total revenue
- Total annualized recurring revenue (ARR) at $29.2 billion including $4.2 billion from Splunk, up 22% year over year, and product ARR at $15.5 billion, up 44% year over year
- Revenue by geographic segment was: Americas down 15%, EMEA down 9%, and APJC down 12%. Product revenue performance reflected growth in Security up 36% and Observability up 27%. Networking was down 27%. Product revenue in Collaboration was flat. Security and Observability, excluding Splunk, grew 3% and 14%, respectively, in the third quarter of fiscal 2024.
https://newsroom.cisco.com/c/r/newsroom/en/us/a/y2024/m05/cisco-reports-third-quarter-earnings.html
