Cisco Systems (CSCO) -) shares moved higher Thursday after the network equipment chipmaker posted better-than-expected fiscal-fourth-quarter earnings and touted its potential in leveraging AI technologies.
Cisco's muted sales forecast, which sees revenue in the region of $57 billion to $58.2 billion over the coming fiscal year, clouded a solid earnings report after the close of trading Wednesday. The group posted a bottom line of $1.14 a share.
Orders were down 14% from a year earlier but improved 30% from the fiscal third quarter, thanks in part to a $500 million boost from ethernet-based AI networking demand.
However, with Chief Executive Chuck Robbins underscoring both recent market-share wins in key product areas, as well as impact investment spending on AI technologies, supporting near-term growth, investors began to bid up Cisco shares in the after-hours session.
"The acceleration of AI will fundamentally change our world and create new growth drivers for us,' Robbins told investors on a conference call late Wednesday.
"While AI has been an important element in our products for several years, this quarter we announced new market-leading AI technologies across our collaboration and security portfolios designed to boost productivity, enhance policy management, and simplify tasks.'
"This is a huge opportunity for Cisco, and we are laser-focused on leading and winning in this space," he added. "As a result of our innovation in this area, we expect ethernet will lead in connecting AI workloads over the next five years."
Cisco Systems shares, a Dow component, were marked 3.8% higher in early Thursday trading to change hands at $55.02 each.
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