Cisco Systems shares rose after the company beat Wall Street's expectations for its quarterly profit and revenue on Wednesday.
AP
The networking equipment maker posted earnings excluding items of 43 cents a share for its fiscal first quarter ended October 29, up from 42 cents a share in the year-earlier period.
Net income was $1.8 billion, down from $1.9 billion a year ago.
During a conference call later Wednesday Cisco projected a 7 to 8 percent rise in fiscal second-quarter sales, translating to $11.13 billion to $11.2 billion in revenue — matching or slightly ahead of the $11.14 billion expected, on average.
Excluding items, Cisco predicted earnings per share of 42 to 44 cents in the quarter, beating the average forecast of 42 cents, signaling its months-long turnaround was bearing fruit.
But CEO John Chambers, who kicked off a months-long overhaul of the company to save $1 billion through layoffs and asset sales, warned that global uncertainty persists and it remains tough to predict market conditions.
Shares of the company's stock rose more than 2 percent after the earnings report. (Get the latest after-hour quotes for Cisco here.)
Revenue rose 5 percent to $11.26 billion from $10.75 billion a year ago.
Analysts had expected the San Jose, Calif., company to deliver earnings of 39 cents per share on revenue of $11.03 billion, according to Thomson Reuters.
"We weren't expecting fireworks for this quarter. It hit my numbers — I was at 42 cents," said Colin Gillis, an analyst at BGC. "Total revenues were up close to 5 percent and that's a positive. These results are right in line with 'new' Cisco," he said.
During regular trading on Wednesday, Cisco fell 3.8 percent to close at $17.61, while the major U.S. stock marketsalso fell sharply amid euro zone concerns.
Cisco Systems has been slashing jobs and culling divisions this year in an effort to revive growth. Analysts were encouraged by this latest report — that the company's efforts are finally beginning to pay off.