Cisco (NASDAQ: CSCO) reported its fiscal 2017 second-quarter earnings after the close Wednesday, and the market's reaction says it all: Initially, shares fell in after-hours trading. But after investors had time for a more detailed review, Cisco shares were up about 2.5% by midday Thursday.

Revenue in Q2 declined 2% year-over-year to  $11.58 billion and earnings per share (EPS) including one-time expenses nosedived 24% to $0.47, though after factoring in one-time costs, Cisco's $0.57 a share matched the EPS from Q2 fiscal 2016. The upside to these somewhat disappointing, though not unexpected, quarterly results, is that Cisco narrowly beat consensus  estimates.

The Street had forecast EPS excluding items of $0.56 and revenue of $11.56 billion, both a whisker below the actual results. The mid-range of guidance for 0% to negative 2% revenue growth this quarter was, again, slightly better than the 1.2% decline expected.

Also an upside, the report indicates that Cisco's efforts to increase sustainable, recurring revenue are taking hold. Cisco mitigated the impact of a 5.5% year-over-year revenue decline in its product segment thanks to a 5% bump in service sales to $3.1 billion. Cisco also attributed its 9% jump in deferred  revenue to $17.1 billion to its subscription-based and software offerings.

In addition to boosting its quarterly dividend by 10% to $0.29, Cisco reported strong data security growth of 14% to $528 million. And the segment is up 13% to $1.07 billion this fiscal year. Given its mixed results, it's no wonder investors were on the proverbial fence.

10 stocks we like better than Cisco Systems
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*

David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and Cisco Systems wasn't one of them! That's right -- they think these 10 stocks are even better buys.

Click here to learn about these picks!

*Stock Advisor returns as of February 6, 2017

Tim Brugger has no position in any stocks mentioned.

Want to learn how to invest?

Get a free 10 week email series that will teach you how to start investing.

Delivered twice a week, straight to your inbox.