Cisco delivers a valentine and returns to sales growth

Cisco on Wednesday saw its stock jump 6 percent after the company reported better than expected earnings for its fiscal second quarter, which ended on January 27.

Revenue from its infrastructure platforms category, which includes switching, routing and data center businesses, rose 2 percent to $6.7 billion. Cisco added that it sees its third-quarter earnings excluding one-time items coming in at between 64 cents and 66 cents a share, while analysts had forecast a profit of 63 cents a share.

In the fiscal second quarter Cisco's applications revenue of $1.18 billion was up 6 percent year over but below the FactSet estimate of $1.2 billion, according to StreetAccount. The company also announced a 14 percent increase in its quarterly dividend to 33 cents a share and an additional United States dollars 25 billion for repurchasing shares.

However, the new tax laws led to an $11.1 billion charge, pushing the company to post a loss for the second quarter. He told CNBC recurring revenue - which now accounts for 33 percent of total revenue - was one of his earliest priorities. Repatriated money could also fund acquisitions, although the Cisco's strategy on capital allocation essentially won't be changing, Kramer said.

"We made continued progress in shipping more of our business to software and services", Robbins said, on a conference call to discuss Cisco's results. Analysts were looking for 63 cents, excluding certain items, on $12.13 billion in revenue for the fiscal third quarter, according to Thomson Reuters. There were no shortages or supply issues in the quarter, Kramer said.

"Cisco looks to slowly be getting back on the modest growth trajectory with a software-centric approach, the key DNA in its turnaround plan", said Ives, who added that adding more software to its long-time arsenal of networking hardware is "music to ears of (Cisco's) customers and partners".

The California-based tech company announced on Wednesday it would move a significant portion of cash to its shareholders over the next two years through increased dividends and buybacks.