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Cisco Systems Inc. (NASDAQ: CSCO) has released its quarterly earnings report for the first quarter of its fiscal year 2016. The networking equipment and services giant reported adjusted earnings per share (EPS) of $0.59 and revenues came in up about 4% at $12.68 billion. Revenues were broken down as $9.84 billion from products (up 4%) and $2.84 billion from services (up 1%).

The Thomson Reuters consensus estimates were $0.56 EPS and $12.65 billion in revenues. This quarterly report also compared to $0.54 EPS and $12.24 billion for the same quarter in 2014. Deferred revenue was $15.2 billion, up 10% in total.

What investors need to understand is that this report from Cisco started out just fine. It beat and there were positives. The guidance comes with some downside to almost no upside. The international climate matters here, and it may very well be that product transitions and competitive pressures are just not easy to escape, even for a technology giant. For the record, even with a slight disappointment ahead, Cisco Systems remains one of 24/7 Wall St.’s own 10 stocks to own for the next decade.

Cisco offered guidance for the following quarter of $0.53 to $0.55 adjusted EPS, and the company sees annual sales growth of 0% to 2% from a year earlier. Thomson Reuters had the consensus estimates at $0.56 EPS and $12.55 billion, so both come with risk.

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There are several non-earnings items to consider. Cisco’s gross margin came in at 63.2%, and gross product margin came in at 62.3%. Cisco ended the quarter with roughly $59.1 billion in cash and cash equivalents, and that is after an increase of 11% in operating cash flows to $2.8 billion. What stands out about the cash is that the $59.1 billion is lower than the $60.4 billion at the end of fiscal 2015, and the liquidity available in the United States was only $5.0 billion.

Adjusted operating expenses were $4.1 billion, down 1%, and at 32.7% of revenue. Cisco’s non-GAAP tax provision rate was 23.0%, and the GAAP tax provision rate was 22.5%.

Cisco’s share buybacks continue. It repurchased approximately 45 million shares of common stock in the quarter, with an average price of $26.83 per share and with a total of $1.2 billion spent. Cisco remains a top buyback giant of all-time: it has now repurchased and retired 4.5 billion shares of its common stock, at an average price of $20.92 per share and with a grand total amount of approximately $93.9 billion.

Now that Chuck Robbins has replaced John Chambers as Cisco’s chief executive officer, he is the one who makes the big comments on the record. Robbins said of the quarter and future:

The first quarter was a very strong quarter. We are accelerating our ability to deliver on growth opportunities, aggressively driving our cloud business, and delivering continued strength in our deferred product revenue, as we sell more of our portfolio in software and cloud models. We guided to solid growth in the second quarter. Our guidance reflects lower than expected order growth in the first quarter, driven largely by the uncertainty of the macro environment and currency impacts. Despite these headwinds, I believe we are executing very well. We are moving very fast to capture new opportunities and I feel good about how we are positioned for the second half of the year.

Cisco shares closed up three cents at $27.85 ahead of earnings, but the shares were down 2.4% at $27.16 in the after-hours shortly after the report was issued. Cisco’s consensus analyst price target ahead of this report was $31.14, and its 52-week range is $23.03 to $30.31.

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