Networking heavyweight Cisco Systems reported that its quarterly profits rose 44 percent, beating analyst's expectations. However, the company forecasts slower growth for its next quarter.
Quentin Hardy with The New York Times reported, "Like other tech giants, including Microsoft and Dell, Cisco is struggling to adapt to this new world. On Wednesday, the company reported fiscal second-quarter earnings that grew 44 percent. Although that was more than Wall Street expected, John Chambers, the chief executive, warned of 'a challenging economic environment.'"
All Things D quoted from Cisco's press release, which said, "Cisco, the worldwide leader in networking that transforms how people connect, communicate and collaborate, today reported its second quarter results for the period ended January 26, 2013. Cisco reported second quarter net sales of $12.1 billion, net income on a generally accepted accounting principles (GAAP) basis of $3.1 billion or $0.59 per share, and non-GAAP net income of $2.7 billion or $0.51 per share."
According to Bloomberg BusinessWeek's Jordan Robertson, "Fiscal third-quarter sales will increase 4 percent to 6 percent from a year earlier, Cisco said on a conference call yesterday, indicating revenue of $12.1 billion to $12.3 billion. Analysts on average predicted (CSCO) sales of $12.2 billion, according to data compiled by Bloomberg. A slowdown in spending by large corporations has limited Cisco’s growth, as has weakness in Europe and Asia, said Bill Kreher, an analyst at Edward Jones & Co. Tepid demand by government agencies 'has the potential to trip us up,' Chief Executive Officer John Chambers said on the call with analysts."
Nicola Leske with Reuters noted, "The company's shares were down 1.7 pct in after hours trading after Cisco reported that revenue growth in Europe -- which accounts for a quarter of its business - was down 5 percent. Revenue in the Americas was up 9 percent and was 8.3 percent higher in the Asia-Pacific region."