Cisco Systems reported quarterly results that topped analysts' expectations on Thursday after the bell, but gave disappointing guidance for its current quarter driven by lower-than-expected order growth and foreign exchange rates.
The networking giant posted fiscal first-quarter earnings of 59 cents per share on $12.68 billion in revenue. Profit and sales rose 9 percent and 4 percent from the previous year, respectively.
Analysts expected Cisco to post earnings of 56 cents per share on $12.65 billion in revenue, according to a consensus estimate from Thomson Reuters. Cisco shares were down 5.3 percent midmorning Friday. (Click here to follow the stock.)
Cisco CEO Chuck Robbins told CNBC on Friday he was pleased with the company's performance in what he called "a tough macro environment."
"We had a very solid quarter with 4 percent top-line growth, 9 percent EPS, very strong gross margins, as well as operating margins at a nine-year high," he told CNBC's "Squawk on the Street." "As we guided Q2, we obviously guided down, but we also guided a reasonable growth quarter."
Cisco said it expects fiscal second-quarter sales will be in a range of flat to up 2 percent year over year. Robbins cited "the uncertainty of the macro environment and currency impacts."
Robbins, who took over the post this summer from John Chambers, has presided over a string of acquisition offers as Cisco looks to unlock growth in new segments. Since late September, Cisco has announced its intent to buy four companies — security firms Portcullis and Lancope, data analytics player ParStream and most recently video software company 1 Mainstream.
Cisco has more than $2 billion invested in start-ups around the world, and investors should expect the company to engage in more strategic partnerships in the future, Robbins told CNBC.
Sales climbed 4.3 percent in fiscal 2015, and revenue growth has not topped 8 percent for five straight years.
It projects non-GAAP earnings of 53 to 55 cents per share in the quarter.
"They are setting some conservative expectations but this is also indicative of some execution challenges," said Erik Suppiger, a JMP Securities analyst who has a "hold" rating on Cisco.
First-quarter sales from data centers rose 24 percent from the year before to $859 million. Revenue in its largest segment, switching, climbed 5 percent to $4.02 billion.
But sales in its second-largest business, routing, declined 8 percent from the previous year to $1.79 billion.
Robbins said the decline was due to a order timing issue, and Cisco expects the business to be in "pretty good shape" in the coming quarters.
— CNBC's Ari Levy contributed to this report.