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Cisco (CSCO) stock price fell slightly in the last trading session but is up now. This has happened after the networking giant reported its third-quarter earnings.
Cisco Systems Inc (NASDAQ: CSCO) stock price dipped by 2.94% yesterday. The stock closed slightly down as the markets generally moved in a downward fashion.
This negative sentiment came as Cisco released its third-quarter earnings. As at the time of filing this report, in the pre-market, Cisco (CSCO) stock price was $43.05 (+2.62%).
Cisco Stock Performs Marginally as Company Reports Mixed Results
For Cisco, the numbers were great considering the current COVID-19 pandemic. Total revenue was down though by 8% to $12 billion. Service revenue moved northwards by 5%. There was growth in its security segment by 6%. The Applications business unit was down by 5%. The infrastructure platforms unit didn’t fare any better by 15%.
Cash flow from operating activities for the quarter was $4.2 billion. This is down 2% from last year on a year-to-date date basis. performance obligations were up 11% to $25.5 billion.
During a conference call, Chuck Robbins, Chairman, and CEO of Cisco Systems Inc. indicated that we are in unusual times. This is due to the emergence of COVID-19. He said:
“During this extraordinary time, our priority has been supporting our employees, customers, partners and communities, while positioning Cisco for the future.”
The COVID-19 pandemic seems to have affected just about every other sector negatively. Technology firms it seems, are the all-weather stocks at this time. Cisco’s performance seems mixed. The fundamentals surrounding the networking giants business remains solid.
On the bright side, Cisco is implementing measures to help Customers to invest in new devices. This is ahead of the COVID-19 recovery period. The “business resiliency program” is offered through Cisco Capital. it enables customers and partners to defer payments till 2021.
Hybrid Work Model Is Emerging
Cisco (CSCO) stock prices are set to increase as more organizations will need networking equipment. Post COVID-19 more people will work from home. There is a new trend when it comes to the workplace. People working remotely is no longer fad. Over 95% of people still in employment are working from home.
Cisco is still the market leader when it comes to networking hardware and software. This is bound to show as the trend becomes major. Chuck Robbins told:
“I think you’ll see many employees that will continue to work from home, you’ll have many that will get back to the office and then you’ll have some that’ll do a little bit of both. It’ll change things like how we think about talent in the future.”
The new hybrid model will set off a new kind of lifestyle. One where distance won’t be a barrier for things to happen. The great thing is that companies like Cisco would be there to provide connectivity. One way or the other that is.
This is one lining in the COVID-19 storm clouds. Cisco’s earnings were 79 cents per share.