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News Summary:
• Overall performance: $12.9 billion in revenue, up 8% year over year, with broad-based strength across thebusiness; GAAP EPS $0.70, up 37% year over year, and Non-GAAP EPS $0.82, up 8% year over year
• Strong demand across the business with 33% year-over-year total product order growth
• Solid progress on business model transformation: Total Annualized Recurring Revenue was $21.6 billion for thefirst quarter of fiscal 2022, up 10% year over year
Q1 Results:
• Revenue: $12.9 billion
• Increase of 8% year over year
• Earnings per Share: GAAP: $0.70; Non-GAAP: $0.82
• GAAP EPS increased 37% year over year
• Non-GAAP EPS increased 8% year over year
Q2 Guidance:
• Revenue: 4.5% to 6.5% growth year over year
• Earnings per Share: GAAP: $0.64 to $0.68; Non-GAAP: $0.80 to $0.82
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FY 2022 Guidance:
• Revenue: 5% to 7% growth year over year
• Earnings per Share: GAAP: $2.77 to $2.89; Non-GAAP: $3.38 to $3.45
Cisco today reported first quarter results for the period ended October 30, 2021. Cisco reportedfirst quarter revenue of $12.9 billion, net income on a generally accepted accounting principles (GAAP) basis of $3.0 billion or $0.70 per share, and non-GAAP net income of $3.5 billion or $0.82 per share.
“In Q1, we had robust growth and continued strong demand despite the very dynamic supply environment,” said Chuck Robbins, Chair and CEO of Cisco.“Cisco’s technology sits at the heart of the accelerated digital transformation happening today. Our breakthrough innovation, strong demand, and the success of our business transformation position us well for another year of growth infiscal 2022.”
“Our teams executed well in a challenging environment, delivering balanced profitable growth with revenue and non-GAAP EPS bothgrowing 8% year over year,” said Scott Herren, CFO of Cisco. “We also continued to make significant progress in our business model transformation. Remaining performance obligations and annualized recurring revenue both grew 10% year overyear with product ARR growth of 21% providing more predictability and visibility to our long-term growth.”
Q1 FY 2022 Highlights:
Revenue — Totalrevenue was up 8% at $12.9 billion, with product revenue up 11% and service revenue up 1%. Revenue by geographic segment was: Americas up 5%, EMEA up 11%, and APJC up 15%. Product revenue performance was led by growth in Secure, Agile Networks up10%, Internet for the Future up 46%, End-to-End Security up 4%, and Optimized Application Experiences up 18%. Hybrid Work was down 7%.
Gross Margin — On a GAAP basis, total gross margin, product gross margin, and service gross margin were 62.4%, 61.5%, and 65.2%,respectively, as compared with 63.6%, 62.7%, and 65.8%, respectively, in the first quarter of fiscal 2021.
On a non-GAAP basis, totalgross margin, product gross margin, and service gross margin were 64.5%, 63.8%, and 66.5%, respectively, as compared with 65.8%, 65.3%, and 67.1%, respectively, in the first quarter of fiscal 2021.
Total gross margins by geographic segment were: 64.5% for the Americas, 64.4% for EMEA and 64.7% for APJC.
Operating Expenses — On a GAAP basis, operating expenses were $4.6 billion, down 8%, and were 35.8% of revenue. Non-GAAP operating expenseswere $4.0 billion, up 2%, and were 31.2% of revenue.
Operating Income — GAAP operating income was $3.4 billion, up 34%,with GAAP operating margin of 26.7%. Non-GAAP operating income was $4.3 billion, up 10%, with non-GAAP operating margin at 33.3%.
Provision for Income Taxes — The GAAP tax provision rate was 18.5%. The non-GAAP tax provision rate was 19.0%.
Net Income and EPS — On a GAAP basis, net income was $3.0 billion, an increase of 37%, and EPS was $0.70, an increase of 37%. On a non-GAAPbasis, net income was $3.5 billion, an increase of 8%, and EPS was $0.82, an increase of 8%.
Cash Flow from Operating Activities— $3.4 billion for the first quarter of fiscal 2022, a decrease of 16% compared with $4.1 billion for the first quarter of fiscal 2021.