Cisco reported quarterly revenue of $9.1 billion, down 7.5% compared to a year ago but ahead of market expectations. Net income (GAAP) fell 27% compared to a year ago to $1.5 billion or $0.26 per share. The company said economic conditions now affect all geographies and industry sectors. Total product orders decreased by 14% year-over-year while product revenue decreased by 11%. 
"Cisco showcased solid financial strength during a period of significant economic challenge," said John Chambers, chairman and chief executive officer, Cisco. "We remain comfortable with our long-term vision and strategy as we move into new market adjacencies and prioritize our existing opportunities. We intend to accelerate the alignment of our resources to prioritize future growth opportunities, gradually decrease our operating expenses, while building even stronger customer relationships to position Cisco for ongoing, long-term market leadership."
In its webcast conference call, Chambers said the company would trim its operating expenses by $1 billion over the next year by means of a hiring freeze and reducing travel by increasing its use of telepresence .
Some highlights from the quarter:
- Cash flows from operations were $3.2 billion for the second quarter of fiscal 2009, compared with $2.4 billion for the second quarter of fiscal 2008, and compared with $2.7 billion for the first quarter of fiscal 2009.
- Cash and cash equivalents and investments were $29.5 billion at the end of the second quarter of fiscal 2009, compared with $26.2 billion at the end of fiscal 2008, and compared with $26.8 billion at the end of the first quarter of fiscal 2009.
- Deferred revenue was $9.3 billion at the end of the second quarter of fiscal 2009, compared with $8.9 billion at the end of fiscal 2008, and compared with $8.8 billion at the end of the first quarter of fiscal 2009.
