The following commentary is what we took out of context rather than verbatim.  The following comments were all given by Cisco Systems’ (NASDAQ:CSCO) Chairman & CEO John Chambers, and we tried to focus on the commentary on a "looking forward" basis rather than a "looking back" basis:

• "Two key takeaways were unique balance from technology and business architecture, with an average growth rate in mid-double digit gains or better."
• "The wave just beginning is Phase II of the internet, Web 2.0 and collaboration and Cisco wants to expand its position." 
• "Services were strong across all categories."
• "Now has 10 product families with order run rates over $1 Billion."
• "Believe we are getting larger portion of customers’ ‘total spend’ compared to competitors.
• "Service revenues is now 16% of total, and it grew by 24% year over year to a $6 Billion run rate and gross margions around 65%."
• "Europe was very strong with 20% y/o/y growth, Asia-pacific was solid in high-teens and U.S. 13%."
• "Video continues to drive and is a potential killer app…"
• "Consumer video and broadband buildouts are driving…unified communications… all will require upgrades to existing Cisco networks and it is now increasing that growth target from 200-300% up to a higher to 400% estimate"
• "Growth opportunity should be well above industry."
• "One area very important… the next frontier will be around collaboration and Web 2.0…will drive next wave of productivity around the globe"
• "Decisions are made on long-term not just next quarter or even two-years."
• "We continue to believe with caveats that long term growth 12-17% guidance year over year…. Cisco will always be affected by spending patterns etc…. GUIDANCE for fiscal 2008 is middle of long-term rate and the 13-16% was right in middle of range.  Revenue guidance for Q2 2008 revenue growth of 16% year over year."
• "We will execute similar stratgey for the next decade that we did in early 1990’s…."

After 24/7 WALL ST. overlaid interpreted that guidance range, we calculate a $9.789 Billion in revenues.  FirstCall shows estimates for the quarter at $9.81 Billion.

UPDATE: (5:03 PM) The CFO said forecasting gross margin is difficult but it will remain at approximately 65.5%.  For calculating earnings per share, it sees 50 million more shares next quarter.  GAAP EPS will be $0.04-0.06 lower than non-GAAP EPS dure to acquisitions and impairments.

UPDATE (5:07 PM) Chambers added "We too see some of the same problems evident in US market, but believes Cisco is in a unique position.  The US enterprise is experiencing some softness, and it sees lumpy growth from U.S. enterprises….."  "We believe that in Web 2.0, WE ARE IN THE FIRST INNING OF A NINE INNING GAME….."

Wall Street must have flopped and gone to a negative bias based upon that Cowen & Co. neutral initiation today, because it hit multi-year highs just yesterday.  Sometimes Wall Street flips and flops that fast, particularly on a crummy market day like today.  This is still surprising that the flop was so rapid and that the crowd was demanding more than anyone believed. 

Shares are now down over 8% in after-hours to $30.10.

Jon C. Ogg
November 7, 2007

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