Cisco Systems Inc CSCO shares are experiencing a drop in premarket trading. The company recently issued third-quarter and FY24 Adjusted EPS and sales guidance below consensus, and disclosed plans for workforce reduction.

For the third quarter, the company predicted revenue of $12.1 billion-$12.3 billion, falling short of the $13.09 billion estimate, and Adjusted EPS of $0.84-$0.86, below the $0.92 estimate.

The full-year 2024 revenue outlook of $51.5 billion-$52.5 billion is lower than the estimated $54.26 billion, along with an Adjusted EPS of $3.68-$3.74, compared to the street view of $3.86. Cisco also plans to reduce its global workforce by about 5% and is expecting pre-tax charges of approximately $800 million.

On a positive note, the company reported second-quarter Adjusted EPS of $0.87, surpassing the analyst consensus estimate of $0.84, and sales of $12.79 billion, beating the analyst estimate of $12.71 billion. Additionally, Cisco raised the quarterly dividend per share by 3% to $0.40, payable on April 24, 2024, to all stockholders of record as of April 4, 2024. 

Price Action: CSCO shares are down 2.17% at $49.19 on the last check Thursday.

Image: Shutterstock/ Anucha Cheechang