Cisco posts 37 percent growth in profits for 1Q

Cisco posted an awesome first-quarter profit in line with analysts' estimates. It also met forecasted sales projections, the company reported today. Net income increased 37 percent to $2.21 billion, or 35 cents a share. Revenue increased 17 percent to $9.55 billion in the quarter ended Oct. 27.

But, if the investing public was a human being, that person would badly need psychotherapy. Cisco's expected, great performance actually sent shares spiraling downward. The stock price fell $2.95 cents on the news, or 9 percent, indicating that when it comes to the world's largest networking equipment maker, good (even 37% growth) just isn't good enough, reports Bloomberg.com.

The dark side was that sales from Cisco's largest 25 customers declined. Eight of these are financial services companies who are feeling the heat from the mortgage crises. (Citigroup, for example, this week reported a loss of $6.5 billion in asset write-downs, its high profile CEO resigned and it said today that it may have to write down another $11 billion in losses from asset-backed bonds. Yeah, the company perhaps didn't have a lot of spare cash this quarter to buy routers.)

Still, for Cisco, orders in emerging markets grew 35 percent. Plus revenue from meat-and-potatoes switches and routers grew, too.

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