Cisco beats forecast, confirms guidance

06 Aug 2008

Networking leader Cisco beat forecasts with its fourth-quarter result and gave investors heart with confirmation of its guidance.

Chairman and CEO John Chambers said in a conference call that the company's confidence in its long-term growth guidance of 12%-17% was "very strong".

He said the current economic problems were a "short-term challenge" and would remain "for the next few quarters".

The networking bellwether boosted Q4 sales 9.9% to $10.4 billion to post a net profit of $2.0 billion, up 4%. Analysts had expected revenue at approximately $10.3 billion.

"Q4 was a very solid quarter, especially given some challenges that we are seeing in the global marketplace," Chambers said.

Full-year net profit rose 9.8% to $8.1 billion on sales of $39.5 billion, up 13.2%.

Sales of enterprise equipment in the slowing US market were up 13% for the fourth-quarter, compared with 6% in Q3.

He said "signals were mixed" in the carrier business, which accounted for a third of company revenue, with service providers at different stages of rolling out IP networks.

Chambers said the results "demonstrate the company's ability to execute" during a time of transition in the market.

"We believe we are entering the next phase of the Internet as growth and productivity will center on collaboration enabled by networked Web 2.0 technologies."

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