Cisco posts higher profit and revenue in Q2

CEO Chambers sees a 'soft recovery' in the world economy

Cisco Systems posted higher revenue and profit in its fiscal second quarter as Chairman and CEO, John Chambers, reiterated the company's ambitious goal to become the biggest company in IT.

For the quarter ended January 26, Cisco posted revenue of $US12.1 billion, up 5 per cent from a year earlier.

Its profit grew even more from the previous year's quarter, with net income rising 44 per cent to $US3.1 billion from $US2.2 billion. Second-quarter earnings per share rose to $US0.59, up from $US0.40 a year earlier. However, those figures included tax benefits of about $US926 million from a settlement with the US Internal Revenue Service and the reinstatement of a federal R&D tax credit. Excluding most one-time items, revenue grew 6.2 per cent. Analysts had forecast that Cisco would have earnings per share of $US0.48.

Cisco is in the midst of a retreat from the consumer sector while it aims for a leading role in enterprise and cloud computing, competing with giants such as IBM and Hewlett-Packard. In December, the company told financial analysts that it hopes to double its software revenue over the next three to five years and also expand its managed services and consulting business. Cisco's annual software revenue is about $6 billion.

Last month, the company said it would sell its Linksys home networking division to Belkin, a smaller competitor in that segment. The move came as no surprise after Cisco killed its Flip video camera and started retreating from its home videoconferencing business in 2011. The company still hopes to reach into consumers' homes with gateway boxes that it sells to service providers.

Cisco is also seizing a growing piece of the mobile infrastructure market. After the company announced its fiscal first-quarter earnings in November, Chambers said Cisco would build small cellular base-station equipment in addition to carrier Wi-Fi gear.

On a conference call following the financial report on Wednesday, Chambers said he thinks the world economy is in a "soft recovery".

"The tone is cautious optimism," Chambers said. However, customers in Europe are still under pressure, he said.

Stephen Lawson covers mobile, storage and networking technologies for The IDG News Service. Follow Stephen on Twitter at @sdlawsonmedia. Stephen's e-mail address is stephen_lawson@idg.com

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.

Tags business issuesNetworkingserversfinancial resultshardware systemsCisco Systems

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?