Cisco stock dropped 2 percent on Wednesday after the company released earnings for the fourth quarter of its 2017 fiscal year, which ended in July.
Revenue -- which was down 4 percent year over year -- has now declined on an annualized basis for seven consecutive quarters. Still, Cisco has beaten earnings and sales estimates for every quarter since CEO Chuck Robbins took over for John Chambers two years ago.
As for guidance, Cisco said for the first quarter of the 2018 fiscal year, it expects 59-61 cents in earnings per share on 1 to 3 percent less revenue than it received for the year-ago quarter. Analysts were expecting 60 cents in earnings per share and $12.05 billion in revenue for guidance for the current quarter, according to Thomson Reuters.
Cisco gets much of its revenue by selling data center switching and routing hardware, and the company's switching and next-generation routing revenue, totaling $5.3 billion, decreased 9 percent year over year and fell below the StreetAccount consensus of analysts' estimates. Cisco's competitors in switching and routing include Arista and Juniper.
Cisco's service revenue for the quarter, which came out to $3.1 billion, was up 1 percent.
Revenue from subscriptions now represents 51 percent of Cisco's software revenue, Robbins said on the company's conference call with financial analysts.
Cisco saw an improvement in U.S. federal business in the quarter, which helped Cisco increase public sector product orders by 2 percent year over year, Robbins said. In the previous quarter public sector orders were down 4 percent.
The company said it repurchased around 38 million shares of common stock at an average of $31.61 per share for a total of $1.2 billion.
Cisco stock is up 7 percent since the beginning of the year, according to FactSet.