Solid Q4 expected from Cisco

Wall Street upbeat on results, outlook for rest of 2012

Cisco's expected to report fourth quarter results that meet or slightly beat Wall Street expectations, based on a robust North American market and sound fundamentals. Cisco's stock rode an upswing earlier this week based on these factors and some analyst upgrades.

Earnings are expected to come in at 46 cents per share, on the high end of the company's guidance delivered last quarter. Revenue is expected to come in at $11.61 billion, according to Yahoo Finance. Revenue would be up 3.7% from last year's Q4, and midway between Cisco's guidance of $11.4 billion and $11.8 billion. Earnings get a 15% boost.

But revenue and earnings are also expected to remain flat in Cisco's first quarter of fiscal 2013, compared to the fourth quarter of fiscal 2012, according to Yahoo Finance.

Nonetheless, a few analyst firms upgraded Cisco based on the outlook for the fourth quarter and some signs of activity heading into the latter part of 2012. Goldman Sachs reportedly expects strong network infrastructure expansion this year, while Oppenheimer notes solid demand in the U.S. and strength heading into October, though offset by continued weakness in Europe.

Cisco's been reducing expenses through workforce reductions and product line rationalization. A year ago, it eliminated 12,000 Cisco jobs; and is currently undergoing a "limited restructuring" to cut another 2% of its headcount, and perhaps more.

For the full fiscal 2012 year, Cisco is expected to record revenue of $46 billion and earnings of $1.83 per share, growth of 6.4% and 13%, respectively. Cisco reports its fourth quarter results on Aug. 15.

EDITORS NOTE: Jim Duffy will be on vacation the weeks of Aug. 13 and 20. He will return to The Cisco Connection blog the week of Aug. 27.

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