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Cisco (CSCO) Reliance on International Sales: What Investors Need to Know
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Have you evaluated the performance of Cisco Systems' (CSCO - Free Report) international operations during the quarter that concluded in July 2024? Considering the extensive worldwide presence of this seller of routers, switches, software and services, analyzing the patterns in international revenues is crucial for understanding its financial resilience and potential for growth.
In the current global economy, which is more interconnected than ever, a company's success in penetrating international markets is crucial for its financial health and growth journey. Investors must understand a company's dependence on overseas markets, as this offers a window into the company's earnings stability, its ability to benefit from varied economic cycles and its potential for long-term growth.
International market involvement serves as insurance against economic downturns at home and enables engagement with economies that are growing more quickly. Still, this move toward diversification is not without its challenges, as it involves navigating through the fluctuations of currencies, geopolitical threats, and the distinctive nature of various markets.
Upon examining CSCO's recent quarterly performance, we noticed several interesting patterns in the revenue generated from its international segments, which are commonly analyzed and observed by Wall Street experts.
The recent quarter saw the company's total revenue reaching $13.64 billion, marking a decline of 10.3% from the prior-year quarter. Next, we'll examine the breakdown of CSCO's revenue from abroad to comprehend the significance of its international presence.
Unveiling Trends in CSCO's International Revenues
During the quarter, EMEA contributed $3.51 billion in revenue, making up 25.7% of the total revenue. When compared to the consensus estimate of $3.54 billion, this meant a surprise of -0.73%. Looking back, EMEA contributed $3.46 billion, or 27.2%, in the previous quarter, and $3.93 billion, or 25.8%, in the same quarter of the previous year.
Of the total revenue, $2.06 billion came from APJC during the last fiscal quarter, accounting for 15.1%. This represented a surprise of +8.19% as analysts had expected the region to contribute $1.91 billion to the total revenue. In comparison, the region contributed $1.87 billion, or 14.8%, and $2.2 billion, or 14.5%, to total revenue in the previous and year-ago quarters, respectively.
International Market Revenue Projections
Wall Street analysts expect Cisco to report $13.76 billion in total revenue for the current fiscal quarter, indicating a decline of 6.2% from the year-ago quarter. EMEA and APJC are expected to contribute 25.8% ($3.55 billion) and 13.8% ($1.9 billion) to the total revenue, respectively.
For the full year, a total revenue of $55.51 billion is expected for the company, reflecting an increase of 3.2% from the year before. The revenues from EMEA and APJC are expected to make up 25.8% and 13.8% of this total, corresponding to $14.3 billion and $7.65 billion respectively.
In Conclusion
Relying on international markets for revenues, Cisco faces both prospects and perils. Thus, tracking the company's international revenue trends is essential for accurately projecting its future trajectory.
In an era of growing international interdependencies and escalating geopolitical disputes, Wall Street analysts are vigilant in tracking these trends for businesses with a global reach, in order to refine their predictions of earnings. It should be noted, however, that a multitude of other elements, such as a company's domestic position, also play a significant role in shaping the earnings forecasts.
At Zacks, a company's changing earnings outlook is given considerable attention due to its proven, strong influence on a stock's price performance in the near term. The connection here is straightforward and positive: when earnings estimates are revised upward, the stock price generally follows suit, increasing as well.
The Zacks Rank, our proprietary stock rating mechanism, demonstrates a notable performance history confirmed through external audits. It effectively utilizes the power of earnings estimate revisions to act as a predictor of a stock's price performance in the near term.
Assessing Cisco's Stock Price Movement in Recent Times
The stock has increased by 4.5% over the past month compared to the 1.9% fall of the Zacks S&P 500 composite. Meanwhile, the Zacks Computer and Technology sector, which includes Cisco, has decreased 5.4% during this time frame. Over the past three months, the company's shares have experienced a gain of 6.6% relative to the S&P 500's 5.2% increase. Throughout this period, the sector overall has witnessed a 5.2% increase.
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Cisco (CSCO) Reliance on International Sales: What Investors Need to Know
Have you evaluated the performance of Cisco Systems' (CSCO - Free Report) international operations during the quarter that concluded in July 2024? Considering the extensive worldwide presence of this seller of routers, switches, software and services, analyzing the patterns in international revenues is crucial for understanding its financial resilience and potential for growth.
In the current global economy, which is more interconnected than ever, a company's success in penetrating international markets is crucial for its financial health and growth journey. Investors must understand a company's dependence on overseas markets, as this offers a window into the company's earnings stability, its ability to benefit from varied economic cycles and its potential for long-term growth.
International market involvement serves as insurance against economic downturns at home and enables engagement with economies that are growing more quickly. Still, this move toward diversification is not without its challenges, as it involves navigating through the fluctuations of currencies, geopolitical threats, and the distinctive nature of various markets.
Upon examining CSCO's recent quarterly performance, we noticed several interesting patterns in the revenue generated from its international segments, which are commonly analyzed and observed by Wall Street experts.
The recent quarter saw the company's total revenue reaching $13.64 billion, marking a decline of 10.3% from the prior-year quarter. Next, we'll examine the breakdown of CSCO's revenue from abroad to comprehend the significance of its international presence.
Unveiling Trends in CSCO's International Revenues
During the quarter, EMEA contributed $3.51 billion in revenue, making up 25.7% of the total revenue. When compared to the consensus estimate of $3.54 billion, this meant a surprise of -0.73%. Looking back, EMEA contributed $3.46 billion, or 27.2%, in the previous quarter, and $3.93 billion, or 25.8%, in the same quarter of the previous year.
Of the total revenue, $2.06 billion came from APJC during the last fiscal quarter, accounting for 15.1%. This represented a surprise of +8.19% as analysts had expected the region to contribute $1.91 billion to the total revenue. In comparison, the region contributed $1.87 billion, or 14.8%, and $2.2 billion, or 14.5%, to total revenue in the previous and year-ago quarters, respectively.
International Market Revenue Projections
Wall Street analysts expect Cisco to report $13.76 billion in total revenue for the current fiscal quarter, indicating a decline of 6.2% from the year-ago quarter. EMEA and APJC are expected to contribute 25.8% ($3.55 billion) and 13.8% ($1.9 billion) to the total revenue, respectively.For the full year, a total revenue of $55.51 billion is expected for the company, reflecting an increase of 3.2% from the year before. The revenues from EMEA and APJC are expected to make up 25.8% and 13.8% of this total, corresponding to $14.3 billion and $7.65 billion respectively.
In Conclusion
Relying on international markets for revenues, Cisco faces both prospects and perils. Thus, tracking the company's international revenue trends is essential for accurately projecting its future trajectory.In an era of growing international interdependencies and escalating geopolitical disputes, Wall Street analysts are vigilant in tracking these trends for businesses with a global reach, in order to refine their predictions of earnings. It should be noted, however, that a multitude of other elements, such as a company's domestic position, also play a significant role in shaping the earnings forecasts.
At Zacks, a company's changing earnings outlook is given considerable attention due to its proven, strong influence on a stock's price performance in the near term. The connection here is straightforward and positive: when earnings estimates are revised upward, the stock price generally follows suit, increasing as well.
The Zacks Rank, our proprietary stock rating mechanism, demonstrates a notable performance history confirmed through external audits. It effectively utilizes the power of earnings estimate revisions to act as a predictor of a stock's price performance in the near term.
Cisco currently has a Zacks Rank #2 (Buy), indicating that it could outperform the broader market in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Assessing Cisco's Stock Price Movement in Recent Times
The stock has increased by 4.5% over the past month compared to the 1.9% fall of the Zacks S&P 500 composite. Meanwhile, the Zacks Computer and Technology sector, which includes Cisco, has decreased 5.4% during this time frame. Over the past three months, the company's shares have experienced a gain of 6.6% relative to the S&P 500's 5.2% increase. Throughout this period, the sector overall has witnessed a 5.2% increase.