Cisco beats Q3 estimates by a penny

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Cisco beats Q3 estimates by a penny

By Jim Duffy

Network World Fusion, 05/11/04

Cisco posted third-quarter pro forma earnings a penny better than expectations, on revenue in line with those expectations.

For the period ended May 1, Cisco recorded sales of $5.6 billion, a 21.7% increase over the same period a year ago and a 4.1% increase from the second quarter of fiscal 2004. Pro forma net income for the third quarter was $1.4 billion, or $0.19 per share, compared with $1.1 billion, or $0.15 per share, for the third quarter of fiscal 2003, and $1.3 billion, or $0.18 per share, for the second quarter of fiscal 2004.

Analysts were expecting pro forma earnings of $0.18 per share.

Net sales for the first nine months of fiscal 2004 were $16.1 billion, compared with $14.2 billion for the first nine months of fiscal 2003, an increase of 13.7%. Pro forma net income for the first nine months of fiscal 2004 was $3.9 billion, or $0.54 per share, compared with $3.2 billion, or $0.44 per share, for the first nine months of fiscal 2003.

“We are pleased to have achieved record earnings per share this quarter,” said John Chambers, Cisco president and CEO, in a statement. “This momentum was achieved through sequential order growth across all major product categories and solid progress in our advanced technologies including security, wireless LAN and IP telephony.”

Chambers said he was especially pleased with order growth in Cisco’s Commercial and Enterprise lines of business, which saw sequential bookings increase in the mid-teens and low double digits, respectively. Enterprise product bookings in wireless, IP telephony and security were especially strong in the quarter.

Cisco’s Service Provider bookings increased in the mid-single digits from Q2.

Product revenue accounted for $4.7 billion of Cisco’s Q3 revenue, while services pulled in the remaining $900 million. Sales of switches accounted for 41% of Q3 revenue, routers for 23%, advanced technologies — IP telephony, security, storage, home networking, optical and wireless — 16%, services 16% and other — access and network management — 4%.

Sales of Linksys home networking gear was $174 million in the quarter, a sequential increase of 5%.

Cisco ended the quarter with a headcount of 34,307, an increase of 214 from Q2. The company expects to hire an additional 1,000 employees this year.

For the fourth quarter of fiscal 2004, Cisco expects revenue to grow 3% to 5%.

To read this story online, go to:

https://www.nwfusion.com/news/2004/0511cisq3.html

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