Thursday, August 18, 2016
Cisco beats earnings but plans to cut 5,500 jobs
Cisco announced its fourth quarter earnings after the bell Wednesday afternoon.
It's a beat across the board, but the stock is down about 1% in after-hours after the company announced its plan to cut 5,500 jobs starting next quarter.
Here are the most important numbers:
EPS (non-GAAP): $0.63 per share vs. $0.60 per share expected
Revenue: $12.64 billion vs. $12.57 billion expected (up 2% year-over-year)
The 5,500 job cuts would present 7% of its total workforce. That's a much lower number than the 20% layoff some reports suggested Tuesday afternoon, but still one of the largest job cuts in Cisco's history.
Cisco expects the next quarter to show -1% to 1% year-over-year revenue growth and EPS of $0.58-$0.60. Analysts are expecting actual revenue to decline 1.6% and EPS of $0.60.
Cisco typically makes big layoffs after the end of its fiscal year in July. From 2011 to 2014, it announced thousands of job cuts after its fourth quarter earnings, including the 6,000 workforce reduction in 2014. It didn't have any layoffs in 2015, which was CEO Chuck Robbins' first year in his position.