Cisco Systems, Inc. (CSCO - Free Report) is set to report fourth-quarter fiscal 2020 results on Aug 12.

For fourth-quarter fiscal 2020, the company anticipates revenues to decline 8.5-11.5% on a year-over-year basis. The Zacks Consensus Estimate for revenues is pegged at $12.09 billion, indicating a decline of 9.9% over the year-ago reported figure.

Non-GAAP earnings are anticipated between 72 cents and 74 cents per share. The Zacks Consensus Estimate for earnings stands at 74 cents per share, stable in the past seven days. The figure indicates a decline of 10.8% from the prior-year quarter.

Notably, the company has a trailing four-quarter earnings surprise of 3.99%, on average.

Factors to Note

Solid demand for Webex Meetings, Webex Devices, and Webex Teams, triggered by coronavirus crisis led work-from-home wave and demand for telehealth services, are expected to have contributed to the fiscal fourth-quarter performance. Markedly, in fiscal third-quarter earnings conference, management stated that 95% of the Fortune 500 is now utilizing Cisco’s collaboration solutions.

Besides, the company updates its Webex portfolio on a monthly basis to aid users enhance productivity with advancements in video conferencing. Integration of advanced AI and ML capabilities is expected to have bolstered engagement and driven adoption. This, in turn, may get reflected in the to-be-reported quarter’s results.

During fiscal fourth quarter, Cisco launched a portfolio of business resiliency solutions to aid enterprises boost workforce and workplace productivity. The company also unveiled solutions focused on distance learning and telehealth services.

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Moreover, momentum in web security, unified threat, and network security and advanced threat offerings, driven by spending on cybersecurity as employees work remotely and surge in Internet traffic, might have aided fiscal fourth-quarter performance.

Also, robust adoption of cloud-based solutions, including Duo and Umbrella, bodes well. The company’s differentiated end-to-end approach across the network, cloud and endpoints is expected to have helped it expand clientele.

In fact, Cisco recently announced that Verizon Business is utilizing the former’s 5000 Series Enterprise Network Compute System (ENCS) purpose-built platform to expand Virtual Network Services (VNS) portfolio.

Additionally, strength in company’s Meraki solutions is likely to have driven growth in wireless domain. Accelerated deployment of 5G and growing adoption of Wi-Fi 6 compliant devices may have bolstered demand for Meraki solutions in the quarter to be reported.

Further, in data-center vertical, momentum in the HyperFlex data-center solution is likely to have continued in the fiscal fourth quarter, driven by coronavirus induced demand for cloud computing solutions. This, in turn, is likely to get reflected in the to-be-reported quarter’s results.

However, increasing investments on portfolio expansion, product enhancements and acquisitions amid stiff competition from Arista (ANET - Free Report) and Juniper in networking infrastructure market may have weighed on fiscal fourth-quarter margin expansion.

Moreover, decline in IT spending and coronavirus pandemic-induced broader macroeconomic weakness across small and medium sized businesses, is likely to have affected the fiscal fourth-quarter performance.