Cisco Systems (NASDAQ:CSCO) has raised its annual revenue forecast following better-than-expected fiscal third-quarter results, where improved margins helped counter a revenue decline.

For Q3, Cisco reported adjusted earnings per diluted share of $0.98, down from $1.00 the previous year, on revenue of $12.7 billion, a 13% decrease year-over-year. Despite the revenue drop, these figures surpassed Wall Street expectations of $0.83 EPS on $12.48 billion revenue. The gross margin increased to 65.1% from 63.4% a year ago.

Looking forward, Cisco now projects its annual revenue to be between $53.6 billion and $53.8 billion, up from the previous range of $51.5 billion to $52.5 billion. The full-year adjusted EPS is expected to be between $3.69 and $3.71, slightly revised from February's forecast of $3.68 to $3.74.