Cisco (NASDAQ:CSCO) guides on its FQ4 CC for flat to 1% Y/Y FQ1 revenue growth and FQ1 EPS of $0.51-$0.53 vs. a consensus for flat growth and EPS of $0.53. Gross margin is expected to be in a range of 61%-62% vs. 61.8% in FQ4.
Cisco plans to cut another 6K jobs (8% of the workforce), and to record a $0.14-$0.18 FQ1 GAAP EPS charge.
John Chambers has offered cautious remarks about service provider and emerging markets demand. Carrier sales are expected to be weak for the next several quarters, and Cisco isn't expecting a major near-term recovery in emerging markets demand.
Total product orders only rose 1% Y/Y in FQ4. Americas orders +2%, EMEA +2%, Asia-Pac -7%. Enterprise orders +9%, SMBs +8%, public sector flat, service provider -11%.
U.S. orders +5% (strong enterprise/SMB demand) and India +18%, but China -23% and other emerging Asian markets -34%.
Weak points: Routing revenue -7% Y/Y, switching -4%, service provider video -10%, collaboration -4%. Strong points: Data center +30% (UCS servers now on a $3B/year run rate), security +29% (boosted by SourceFire).