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Cisco Systems (NASDAQ:CSCO) shares gained more than 7% after-hours following the company’s reported Q2 results, with EPS of $0.88 coming in better than the consensus estimate of $0.85.
Revenue grew 7% year-over-year to $13.6 billion, with product revenue up 9% and service revenue up 2%. This compares to the consensus estimate of $13.41B.
Total annualized recurring revenue (ARR) increased 6% year-over-year to $23.3B. Total software revenue and software subscription revenue grew 10% and 15% year-over-year, respectively. Remaining performance obligations (RPO) were $31.8B, up 4% year-over-year.
The company expects Q3/23 EPS in the range of $0.96-$0.98, better than the consensus estimate of $0.89. Revenue is expected to grow in the range of 11%-13% year-over-year.
For the full year, the company expects EPS of $3.73-$3.78, better than the consensus estimate of $3.55. Revenue is expected to grow in the range of 9%-10.5% year-over-year.
The company hiked its dividend by 3% to $0.39 per common share, which will be paid on April 26, 2023 to all stockholders of record as of the close of business on April 5, 2023.
“We are raising our full year outlook driven by our growing recurring revenue base and RPO, along with our healthy backlog and the steps we have taken to improve supply. We have once again increased our dividend, reflecting the strength of our cash flow generation and our commitment to shareholder returns,” said Scott Herren, CFO of Cisco.
