Cisco Systemsreported earnings and revenue that beat analysts' expectations during what its CEO said was an "unusually strong quarter" and also raised its dividend by 75 percent on Wednesday.
AP
After the earnings announcement, the computer networking giant's shares rose in trading after the closing bell. (Click here to get the latest quotes for Cisco.)
“It was an unusually strong quarter, especially in Asia-Pacific," said John Chambers, the company's chief executive officer. "The U.S. saw some positive trends. Europe was a bit challenged.” (See More: Cisco CEO Explains Earnings)
Chambers said the company added 1,400 employees during the period. He added that the company saw steadily declining numbers in Europe but saw the reverse in Asia.
The company also raised its dividend to 14 cents a share from 8 cents a share.
In a subsequent interview on CNBC, Kenneth Langone, CEO of Invemed Associates, said that Cisco's dividend increase showed that "there's no incentive to put the money back into the business because of what's going on in the country." (Click here to watch the Langone interview.)
The company posted fiscal fourth-quarter earnings excluding items of 47cents per share, upfrom 40 cents a share in the year-earlier period.
Net income, excluding items, rose 15 percent to $2.5 billion, or 47 cents per share, from $2.2 billion, or 40 cents a share.
Revenue rose 4 percent to $11.7 billion from $11.2 billion a year ago.
Analysts had expected the company to report earnings excluding items of 45 cents a share on $11.6 billion in revenue, according to a consensus estimate from Thomson Reuters.
In the company's earnings call, Cisco forecast that it would earn between 45 cents and 47 cents in the fiscal first quarter, compared to analysts' estimates of 46 cents. Its revenue guidance called for 2 percent to 4 percent revenue growth in the quarter. (Read More: Are More Dividend Hikes Coming?)
During the fourth quarter, Cisco repurchased 108 million shares of common stock under its stock repurchase program for a total purchase price of $1.8 billion.
The company had spooked investors three months ago, when Chambers cautioned that macroeconomic conditions in Europe could hurt technology spending.
JMP Securities analyst Erik Suppiger said that while investors are happy that the spending cuts are boosting Cisco's profits, revenue growth is essential to its long-term success.
"Ultimately the company needs to generate some acceleration in revenue growth," Suppiger said.
He added that it remains to be seen whether Chambers can get revenues growing again if he continues to cut spending, particularly sales and marketing.
