Cisco revenue, profit grew in fourth quarter

Cisco reported revenue and profit gains for its fiscal fourth quarter ended last month.

Cisco Systems on Tuesday posted solid if unspectacular revenue growth for its fiscal fourth quarter, reporting sales of US$10.4 billion, up 10 percent from a year earlier, despite economic weakness in some parts of the world.

The company's net income for the quarter, which ended July 26, was US$2 billion, or US$0.33 per share. Not counting certain one-time items, it came in at US$2.4 billion, or US$0.40 per share, slightly beating analysts estimates of US$0.39 per share, according to a consensus provided by Thomson Financial. The analysts had forecast revenue of US$10.31 billion.

Chairman and CEO John Chambers explained the gains with a familiar refrain in prepared comments, saying the business process changes and productivity gains enabled by networking are gaining traction worldwide.

For its full 2008 fiscal year, Cisco reported revenue of US$39.5 billion, up 13 percent from the prior year, and net income of US$8.1 billion, or US$1.31 per share.

Chambers said he saw some hopeful signs for IT spending by U.S. enterprises, indicating a slump that began about a year ago may have bottomed out. Overall product orders by enterprises in the U.S. and Canada grew 13 percent in the quarter from a year earlier. Large multinationals and financial services companies led the slowdown and appear to be coming out of it first, with double-digit order growth in the past two quarters, Chambers said. But he said it was too early to tell whether enterprises were truly rebounding.

"We are seeing progress in the U.S. enterprise market," Chambers said on a conference call following the report.

The company's forecasts were cautious, covering only the next two quarters instead of the full 2009 fiscal year. Cisco estimates its revenue will grow about 8 percent in the current quarter, compared with a year earlier, and about 8.5 percent in the second quarter. The company stuck to its long-term forecast of 12 percent to 17 percent year-over-year revenue growth per quarter, without forecasting when quarterly growth would return to that level.

Cisco believes the economic downturn in the U.S. will be relatively short and the company will continue to invest throughout it, hoping to seize a greater share of customers' spending, Chambers said. Outside the U.S., most customers say business growth and gross domestic product (GDP) is solid, he said. Product order growth in several large developing countries, such as China, India, Mexico and Russia, far outpaced other parts of the world, he said.

The company plans to expand its product line into product categories adjacent to its current offerings in many areas, ranging all the way from enterprise data centers to home network devices, according to Chambers.

Among Cisco's newest technologies, Chambers highlighted Telepresence, the high-end video conferencing system. Telepresence sales in the quarter grew about 500 percent from a year earlier, and the systems might generate US$1 billion of revenue per year within five years, he said. Cisco is betting heavily on new collaboration tools such as Telepresence. In the past six months, Cisco's enterprise and service-provider customers have gone from talking about network collaboration theoretically to discussing how they should deploy it, he said.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Stephen Lawson

IDG News Service
Show Comments

Cool Tech

Toys for Boys

Family Friendly

Stocking Stuffer

SmartLens - Clip on Phone Camera Lens Set of 3

Learn more >

Christmas Gift Guide

Click for more ›

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Aysha Strobbe

Microsoft Office 365/HP Spectre x360

Microsoft Office continues to make a student’s life that little bit easier by offering reliable, easy to use, time-saving functionality, while continuing to develop new features that further enhance what is already a formidable collection of applications

Michael Hargreaves

Microsoft Office 365/Dell XPS 15 2-in-1

I’d recommend a Dell XPS 15 2-in-1 and the new Windows 10 to anyone who needs to get serious work done (before you kick back on your couch with your favourite Netflix show.)

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Cathy Giles

Brother MFC-L8900CDW

The Brother MFC-L8900CDW is an absolute stand out. I struggle to fault it.

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?