# Cisco forecast raise allays tech spending fears, lifts shares
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2023-02-16
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Cisco Systems Inc Raises Forecast After Strong Q2 Results
Meta Description: Cisco Systems Inc raises full-year earnings forecast, indicating steady network infrastructure investments amid economic slowdown. Strong Q2 results and easing
URL: https://financedigest.com/cisco-forecast-raise-allays-tech-spending-fears-lifts-shareshtml

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By Yuvraj Malik

(Reuters) -Cisco Systems Inc on Wednesday raised its full-year earnings forecast and delivered strong second-quarter results, indicating that spending on network infrastructure was staying resilient in the face of an economic slowdown.

The maker of routers and other products that run computer networks and the internet said customers were keeping investments steady in systems related to cloud, artificial intelligence and tools for hybrid work.

The company is also benefiting from the easing of pandemic-driven supply chain constraints, which plagued its [business last year](https://www.financedigest.com/why-the-new-year-is-the-best-time-to-start-your-dream-tech-business.html "Why the New Year is the best time to start your dream tech business") and resulted in significant inventory buildup.

Cisco is better positioned today than at any [time since](https://www.financedigest.com/soccer-arsenal-reach-womens-champions-league-semis-for-first-time-since-2013.html "Soccer-Arsenal reach Women’s Champions League semis for first time since 2013") I became CEO almost eight years ago,” Chuck Robbins said in a post-earnings analyst call. [Shares of the company were 3% higher after earlier jumping](https://www.financedigest.com/global-shares-jump-but-bank-whack-a-mole-not-over.html "Global shares jump but bank ‘whack-a-mole’ not over") 12% in extended trading.

For fiscal 2023, Cisco said it expects [revenue growth](https://www.financedigest.com/visa-revenue-growth-slows-more-as-tough-economy-sobers-spending.html "Visa revenue growth slows more as tough economy sobers spending") of 9% to 10.5%, and adjusted per share earnings between $3.73 to $3.78. It had previously forecast [revenue growth of 4.5% to 6.5% and earnings per share](https://www.financedigest.com/orpea-shares-jump-on-q4-revenue-and-cash-boost.html "Orpea shares jump on Q4 revenue and cash boost") of $3.51 to $3.58.

Its second-quarter adjusted earnings of 88 cents per [share and revenue of $13.59 billion](https://www.financedigest.com/abb-to-launch-1-billion-share-buyback-on-april-3.html "ABB to launch  billion share buyback on April 3") were both higher than market estimates pooled by Refinitiv.

This is very [strong growth](https://www.financedigest.com/impact-com-ends-2022-with-strong-momentum-driven-by-client-and-agency-partner-growth.html "impact.com Ends 2022 with Strong Momentum Driven by Client and Agency Partner Growth") and shows that the company may finally be exiting a difficult period related to supply-chain challenges,” said Scott Raynovich, chief analyst at Futuriom.

Cisco said it reduced backlog 6% sequentially, while remaining performance obligations (RPO), a metric that denotes contractual [revenue that will be recognized in the future](https://www.financedigest.com/title-n95-mask-market-future-is-set-for-massive-growth-with-high-revenue.html "N95 Mask Market Future is Set for Massive Growth with High Revenue"), was $31.8 billion as of January-end, compared to $30.9 billion in October.

Cisco’s [strong performance](https://www.financedigest.com/equity-markets-show-strong-end-of-year-performance-in-camradatas-q4-2017-investment-research-reports.html "Equity Markets Show Strong End of Year Performance in CAMRADATA’s Q4 2017 Investment Research Reports") comes at a time of cost-cutting and restructuring across the U.S. [technology sector](https://www.financedigest.com/why-its-time-to-centralise-public-sector-technology.html "Why it’s time to centralise public sector technology") in response to economic headwinds. Cisco had announced a nearly 5% workforce reduction in November.

(Reporting by Yuvraj Malik in Bengaluru; Editing by Shailesh Kuber)


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