Cisco Squeeks Past Estimated With Explosive Earnings

Cisco Systems Inc (NASDAQ: CSCO) reported third quarter net sales of $10.4 billion, net income on a generally accepted accounting principles (GAAP) basis of $2.2 billion or $0.37 per share, and non-GAAP net income of $2.5 billion or $0.42 per share. Thomson Reuters had estimates at $0.39 EPS and revenues of $10.24 billion. The quarter ended May 1. The third quarter of fiscal 2010 had 14 weeks compared with 13 weeks in the third quarter of fiscal 2009.

Revenue rose by 27% and EPS by 40%. Cisco ended the quarter with $38 billion in cash and equivalents.

Net sales for the first nine months of fiscal 2010 were $29.2 billion, compared with $27.6 billion for the first nine months of fiscal 2009. Net income for the first nine months of fiscal 2010, on a GAAP basis, was $5.8 billion or $0.99 per share, compared with $5.1 billion or $0.86 per share for the first nine months of fiscal 2009. Non-GAAP net income for the first nine months of fiscal 2010 was $6.9 billion or $1.18 per share, compared with $6.1 billion or $1.04 per share for the first nine months of fiscal 2009.

“Our financial results were outstanding, achieving record level revenue and earnings per share results. We saw a return to strong balanced growth across geographies, products and customer segments that we haven’t seen since before the global economic challenges began. We emerge from this downturn gaining market share, a larger share of the total wallet spend of our customers, dramatically improved customer relations as a trusted technology and business partner, and having next-generation products in almost every product category. It is clear that our game plan for how to handle economic downturns is hitting on all cylinders,” said John Chambers, chairman and CEO of Cisco.

Douglas A. McIntyre