Investors await Cisco’s Q4 results – will there be surprises?

Investors are waited with baited breath as to what Cisco will post for its fourth-quarter results after the

markets close today. Wire reports suggest the networking bellwether will report a 9.5% increase in Q4 profit to $2.11 billion, or 35 cents a share, from $1.93 billion, or 31 cents a share last year. Revenue will likely have increased 9.3% to $10.3 billion.

Bloomberg is reporting that Cisco is suffering from cuts in spending by service providers and telephone companies, noting that AT&T – which apparently contributes 2% of Cisco sales – last month said it planned to curb investments in the second half. Cisco already saw cuts in budgets by customers in the automobile and financial industries, according to Bloomberg. The news service also reports challenges for Cisco in the enterprise market, quoting Walter Price, a managing director at RCM Capital Management in San Francisco as saying: “It’s turning out that network equipment seems to be more discretionary than people realized.”

Meanwhile, Fortune is reporting that investors are worried that Cisco CEO John Chambers won’t estimate a target for fiscal 2009 growth.

There does seem to be light at the end of the tunnel. Bloomberg cites Chuck Heath, an analyst at UMB Investment Advisors as saying: “As you look out 9 to 12 months ahead, you see revenue reaccelerate.”

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