Cisco Systems reported quarterly income of $4.6 billion, down by 4.2% compared with $4.8 billion for the same period last year and compared with $4.7 billion for the preceding quarter. Despite the decrease in overall revenue, Cisco described the quarter as "solid" in profit, net income and gross margins. Operating cash flow was $1.26 billion and earnings per share were $0.14 GAAP or $0.15 pro forma. Regarding overall market conditions, Cisco CEO John Chambers said he is "slightly more optimistic" than he was three months ago. Some highlights for the quarter include:
- pro forma gross margins continued to improve to 70.8%, compared to 63.1% last year
geographically, the U.S. accounted for 45% of total product orders, EMEA was 32% and Asia-Pacific was 10%.
revenue guidance for the next quarter was given as "flat," compared with "flat to down slightly" three months ago
Cash and total investments were over $20.3 billion at the end of the quarter
During the quarter, Cisco repurchased approximately $2.0 billion of common stock
In the service provider segment, Cisco noted continued caution and the prospect of further CAPEX cuts
regarding the expensing of stock options, John Chambers said he feels very strongly that employee ownership is a vital principle for the vitality of the IT industry. Without stock options, he predicts a major job loss in the US, as the industry competitiveness flows to Asia. He said 80% of Cisco stock grants go to rank-and-file employees.
An archived webcast of the company's quarterly conference call is online.
http://www.cisco.com
