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Local Tech Wire
RESEARCH TRIANGLE PARK, N.C. — Network equipment-maker Cisco Systems Inc. (NASDAQ: CSCO) Wednesday reported first-quarter earnings of 36 cents per share, down from the year before but a nickel ahead of analysts’ estimates.
In a statement issued after the markets closed, Cisco said it had net sales of $9 billion in the July-October quarter and net income of $2.1 billion, down from $2.5 billion a year earlier. The comparable first-quarter earnings last year were 42 cents.
Analysts polled by Thomson/First Call had predicted revenue would be lower, at $8.74 billion.
The figures for the first quarter after one-time expenses were net income of $1.8 billion, or 30 cents per share. The previous first quarter showed $2.2 billion and 37 cents per share.
Cisco shares closed at $23.29 Wednesday, up 38 cents, and rose above $24 in after-hours trading before settling back to $23.95.
This is the first quarter in which Cisco has used new accounting standards. "Net sales for the first quarter of fiscal 2010 were approximately $50 million higher than the net sales that would have been recorded under the previous accounting guidance," Cisco said.
Cisco, based in San Jose, Calif., employs about 4,000 people in RTP.
Chairman and Chief Executive Officer John Chambers noted, "Building off what we saw as a clear tipping point in Q4, our Q1 results continued to reflect strong sequential growth trends that meet or exceed expectations during normal economic times."
Chambers added, "Our ability to launch four proposed acquisitions, the ecosystem-shifting coalition with EMC/VMware, and five new products and industry solutions into the Cisco pipeline in the past few months alone underscore this momentum."
Cisco is trying to buy Tandberg, a teleconferencing provider, but is encountering headwinds from Tandberg shareholders who say the $3 billion offer is too low.
Cisco also said it is adding $10 billion for additional repurchases of its common stock. Cisco’s board had previously authorized up to $62 billion.
In a discussion of the results, Cisco executives said they believe that the fourth quarter of the previous fiscal year marked an economic bottom and that business would improve. They also said that the current year’s first quarter is in keeping with first-quarter results over a five-year period from 2004 through 2008.