Cisco Systems (NASDAQ: CSCO) reported Q2 2023 revenue of $13.6 billion, up 7% year-over-year

February 15, 2023 Cisco Systems (NASDAQ: CSCO) today reported second quarter results for the period ended January 28, 2023.

Q2 revenue was $13.6 billion, analysts expected $13.43 billion; Q2 product revenue was $10.16 billion, analysts expected $10.02 billion; Q2 Security and Agile Networks revenue was $6.75 billion, analysts expected $6.47 billion; Q2 services revenue was $3.44 billion, analysts expected $3.43 billion; full-year revenue was expected to grow 9%-10.5%, analysts expected to increase 5.7%. The company had previously expected growth of 4.5%-6.5%; Revenue is expected to rise 11%-13% in the fiscal third quarter, compared with analysts’ expectations of 5.8%.

Q2 FY 2023 Highlights

Total revenue was up 7% at $13.6 billion, with product revenue up 9% and service revenue was up 2%. Revenue by geographic segment was: Americas up 9%, EMEA up 5%, and APJC was up 1%. Product revenue performance was led by growth in Secure, Agile Networks up 14%, End-to-End Security up 7%, and Optimized Application Experiences up 11%. Internet for the Future was down 1% and Collaboration was down 10%.

Gross Margin — On a GAAP basis, total gross margin, product gross margin, and service gross margin were 62.0%, 60.2%, and 67.2%, respectively, as compared with 63.3%, 61.8%, and 67.3%, respectively, in the second quarter of fiscal 2022.

On a non-GAAP basis, total gross margin, product gross margin, and service gross margin were 63.9%, 62.1%, and 69.1%, respectively, as compared with 65.5%, 64.3%, and 68.8%, respectively, in the second quarter of fiscal 2022.

Operating Income — GAAP operating income was $3.3 billion, down 6%, with GAAP operating margin of 24.2%. Non-GAAP operating income was $4.4 billion, up 1%, with non-GAAP operating margin at 32.5%.

Net Income and EPS — On a GAAP basis, net income was $2.8 billion, a decrease of 7%, and EPS was $0.67, a decrease of 6%. On a non-GAAP basis, net income was $3.6 billion, an increase of 3%, and EPS was $0.88, an increase of 5%.

Guidance

CISCO SYSTEMS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS

About Cisco

Cisco (Nasdaq: CSCO) is the worldwide leader in technology that powers the Internet. Cisco inspires new possibilities by reimagining your applications, securing your data, transforming your infrastructure, and empowering your teams for a global and inclusive future. Discover more at newsroom.cisco.com and follow us on Twitter at @Cisco.

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