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Cisco Systems Inc. beat quarterly estimates for revenue and profit on Wednesday as COVID-19 lockdowns globally boosted demand for its remote-work tools and networking equipment, sending shares of the Dow component up nearly 3% after the bell.
The health crisis has forced many businesses to go completely online, with many companies increasing the use of video conferencing and virtual private network software, including Cisco’s Webex and AnyConnect.
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The surge in internet activity has also increased the usage of networking equipment that Cisco sells.
“The pandemic has driven organizations across the globe to digitize their operations and support remote workforces at a faster speed and greater scale than ever before,” Chief Executive Officer Chuck Robbins said in a statement.
The network gear maker said it expects fourth-quarter revenue to drop 8.5% to 11.5% from a year earlier to between $11.47 billion and $11.86 billion.
Analysts were expecting revenue of $11.82 billion, according to Refinitiv data.
Cisco reported an 8% drop in third-quarter revenue to $12 billion, but narrowly beat analysts’ average estimate of $11.7 billion.
Excluding items, the company earned 79 cents per share, topping expectations of 69 cents.