Cisco Shares Plummet 8.4% Despite Beating Earnings Estimates
Cisco Systems (NASDAQ:CSCO) shares plummeted by an 8.4% drop on Thursday during mid-day trading, reaching a low of $111.48 before settling at $113.47. Despite this decline, the stock's average session volume saw a substantial increase of 157%, with 61,115,994 shares traded.
The network equipment provider had previously closed at $123.88 and reported record fiscal Q4 revenue of approximately $17.3 billion, up 18% year over year. Non-GAAP EPS of $1.22 surpassed the consensus estimate of $1.17.
Several analysts raised their price targets after the report, with Wells Fargo increasing its target to $150 and Rosenblatt setting a target at $165. However, gross-margin concerns weighed on the stock, as Cisco's AI networking expansion may pressure profitability through product mix, pricing, and investment requirements.