Cisco Systems Inc. (CSCO) shares fell Wednesday after the closing bell after the company reported adjusted third-quarter earnings of 66 cents per share, topping analyst estimates by a penny.
Shares were down 3.7% to $43.50 in after-hours trading. Year to date, shares are up almost 14%.
Revenue for the period rose 4% to $12.5 billion, just ahead of analysts' expectations of $12.43 billion.
"We are executing well against our strategy, our innovation pipeline has never been stronger, and we continue to make great progress in transforming towards more software and subscriptions," said Chuck Robbins, Cisco's Chairman and CEO. "I am confident with our position in the industry and the impact we will continue to drive with our customers."
A squeezed product gross margin may be responsible for Wednesday afternoon's selloff as the company reported non-GAAP product gross margins of 62.9% vs. 63.2% last year. Operating expenses also rose 6% year over year, representing 32.5% of the company's revenue.
Cisco said it expects its non-GAAP EPS to rise in the next quarter to between 68 cents and 70 cents per share.
Sign of selling after Cisco earning report, CSCO closed at $44.98, a pull back to trend line support of $42.00 is preferred if want to continue it bull run since it broke off it consolidation in September 2017. 200 days Moving Average is still pointing up at $38.15.