Don't Overlook Cisco (CSCO) International Revenue Trends While Assessing the Stock

Zacks Equity Research

Mon, May 19, 2025, 7:15 AM 4 min read

Did you analyze how Cisco Systems (CSCO) fared in its international operations for the quarter ending April 2025? Given the widespread global presence of this seller of routers, switches, software and services, scrutinizing the trends in international revenues becomes imperative to assess its financial strength and future growth possibilities.

In the modern, closely-knit global economic landscape, the capacity of a business to access foreign markets is often a key determinant of its financial well-being and growth path. Investors now place great importance on grasping the extent of a company's dependence on international markets, as it sheds light on the firm's earnings stability, its skill in leveraging various economic cycles and its broad growth potential.

Presence in international markets can act as a hedge against domestic economic downturns and provide access to faster-growing economies. However, this diversification also brings complexities due to currency fluctuations, geopolitical risks and differing market dynamics.

In our recent assessment of CSCO's quarterly performance, we discovered notable trends in its overseas revenue sections, which are typically modeled and scrutinized by Wall Street analysts.

For the quarter, the company's total revenue amounted to $14.15 billion, experiencing an increase of 11.4% year over year. Next, we'll explore the breakdown of CSCO's international revenue to understand the importance of its overseas business operations.

Unveiling Trends in CSCO's International Revenues

EMEA accounted for 26.40% of the company's total revenue during the quarter, translating to $3.74 billion. Revenues from this region represented a surprise of -0.02%, with Wall Street analysts collectively expecting $3.74 billion. When compared to the preceding quarter and the same quarter in the previous year, EMEA contributed $3.86 billion (27.55%) and $3.46 billion (27.22%) to the total revenue, respectively.

Of the total revenue, $2.03 billion came from APJC during the last fiscal quarter, accounting for 14.38%. This represented a surprise of -0.35% as analysts had expected the region to contribute $2.04 billion to the total revenue. In comparison, the region contributed $1.93 billion, or 13.82%, and $1.87 billion, or 14.75%, to total revenue in the previous and year-ago quarters, respectively.

Revenue Forecasts for the International Markets

Wall Street analysts expect Cisco to report a total revenue of $14.6 billion in the current fiscal quarter, which suggests an increase of 7% from the prior-year quarter. Revenue shares from EMEA and APJC are predicted to be 26.2% and 14.4%, corresponding to amounts of $3.83 billion and $2.1 billion, respectively.

Analysts expect the company to report a total annual revenue of $56.47 billion for the full year, marking an increase of 5% compared to last year. The expected revenue contributions from EMEA and APJC are projected to be 26.6% ($15.01 billion) and 14.3% ($8.07 billion) of the total revenue, in that order.

Key Takeaways

Cisco's leaning on foreign markets for its revenue stream presents a mix of chances and challenges. Therefore, a vigilant watch on its international revenue movements can greatly aid in projecting the company's future direction.

In an era of growing international interdependencies and escalating geopolitical disputes, Wall Street analysts are vigilant in tracking these trends for businesses with a global reach, in order to refine their predictions of earnings. It should be noted, however, that a multitude of other elements, such as a company's domestic position, also play a significant role in shaping the earnings forecasts.

Here at Zacks, we put a great deal of emphasis on a company's changing earnings outlook, as empirical research has shown that's a powerful force driving a stock's near-term price performance. Quite naturally, the correlation is positive here -- an upward revision in earnings estimates drives the stock price higher.

With an impressive externally audited track record, our proprietary stock rating tool - the Zacks Rank - harnesses the power of earnings estimate revisions and serves as an effective indicator of a stock's near-term price performance.

Cisco, bearing a Zacks Rank #3 (Hold), is expected to mirror the broader market's movements in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

A Look at Cisco's Recent Stock Price Performance

Over the preceding four weeks, the stock's value has appreciated by 14.1%, against an upturn of 13.1% in the Zacks S&P 500 composite. In parallel, the Zacks Computer and Technology sector, which counts Cisco among its entities, has appreciated by 18.9%. Over the past three months, the company's shares have seen a decline of 0.6% versus the S&P 500's 2.3% decline. The sector overall has witnessed a decline of 4.8% over the same period.

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This article originally published on Zacks Investment Research (zacks.com).

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