CSCO PANW: Weak Guidance
Cisco (CSCO) and Palo Alto Networks (PANW) both reported earnings after the close and got hit in the after hours for weak guidance. CSCO lowered full year revenue guidance from $57.0-$58.2 billion to $53.8-$55.0 billion – about a 5.6% decrease at the midpoints. It also lowered Non-GAAP EPS guidance from $4.01-$4.08 to $3.87-$3.93. CSCO finished the after hours down 11%.
PANW lowered its full year billings guidance from $10.9-$11.0 billion to $10.7-$10.8 billion. While this might not seem like a big deal, historically PANW almost always marginally increases guidance. And for such an expensive stock – PANW trades for almost 50x forward earnings guidance – growth is paramount and any whiff that it is slowing can hit shares hard. PANW finished the after hours down 6%.
The question is whether these reports have any macro implications…..