Cisco raises dividend
Technology giant Cisco, the world’s largest maker of networking equipment, has increased its dividend after reporting better-than-expected results.
The company said cost cutting helped fourth quarter net income to rise to $1.9 billion from $1.2 billion a year ago, on revenue up 4.4 per cent to $11.7 billion, despite difficulties in Europe.
Cisco also said it would raise its dividend by 75 per cent to 14 cents a share. The company’s shares rose 5 per cent to $18.23 in after-hours trading on the news.
Chief executive John Chambers forecast revenue growth of between 2-4 per cent in the next quarter, but warned of continuing uncertainty in Europe, a key market, which was creating an environment in which it was difficult to clinch business deals.
“That’s probably going to get tougher before it gets better and that might last for a good little while,” he said in a conference call. As a result, “many of our customers continue to anticipate a challenging next 12 months on a global basis and therefore these CEOs will remain conservative both in their IT expenditures but also in their hiring”.
Cisco is undergoing a restructuring programme that aims to cut expenses by about $1 billion. Last month it announced it would cut 1,300 jobs.