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Cisco stock rose 5 percent after the company reported better-than-expected earnings for the first quarter of its 2019 fiscal year. Executives will discuss the results with analysts on a conference call at 4:30 p.m. Eastern time.
Here's how the company did:
Overall revenue was up 8 percent year over year in the quarter, which ended on Oct. 27, according to a statement.
Cisco's largest business segment, Infrastructure Platforms, which includes hardware like data center networking switches, hit $7.64 billion in revenue, above the FactSet analyst consensus of $7.4 billion.
Cisco's Applications business, which contains collaboration tools and the AppDynamics software, posted $1.42 billion in revenue, higher than the $1.35 billion estimate.
And Cisco's Security segment did $651 million in revenue, slightly exceeding the estimate of $648 million.
In the quarter Cisco acquired Duo Security for $2.35 billion.
With respect to guidance, Cisco said it's expecting 71 cents to 73 cents in earnings per share, excluding certain items, on 5 percent to 7 percent revenue growth, which works out to $12.48 billion to $12.71 billion, for the fiscal second quarter. That's in line with the Refinitiv consensus estimates of 72 cents per share, excluding certain items, on $12.53 billion in revenue for the quarter.
"Our checks suggest the sales pipeline for 2019 remains strong but the January quarter could see some drag from customers digesting outsized purchases in December to avoid potential price increases in 2019 (from tariffs potentially increasing to 25 percent on January 1st)," Morgan Stanley analysts led by James Faucette wrote in a note distributed to clients on Tuesday. "We would likely view such headwinds as temporary: most of our contacts still see significant Cat9K [Catalyst 9000 networking switch] upgrade opportunities next year while Meraki continues to drive growth in the commercial and SMB markets."
Cisco stock is up 17 percent since the beginning of 2017.