Cisco Profits Fall But Beat Expectations

Aug. 11, 2011
'We've made significant progress on our comprehensive action plan.'

Networking giant Cisco reported falling profits for the fourth quarter and the full fiscal year Wednesday as it seeks to downsize and restructure for future growth.

Net income was $1.2 billion in the fourth quarter ending July 30, a decline of 36.3% from the same period in 2010, the company said after the stock markets closed.

Full-year income was $6.5 billion, a drop of 16.4% from a year ago.

Earnings per share for the fiscal year, excluding special items, were $1.62, two cents better than the average analyst estimate. Revenues rose 7.9%.

Shares in the fourth quarter earned 40 cents.

"We've made significant progress on our comprehensive action plan to position ourselves for our next stage of growth and profitability, while delivering solid financial results in Q4," said Cisco Chairman and CEO John Chambers.

"As we start our next fiscal year, you will see a very focused, agile, lean and aggressive company that is laser-focused on helping our customers use intelligent networks to transform their businesses."

Cisco reported pretax charges of $772 million for the fourth quarter and $923 million for the fiscal year 2011, citing restructuring and other charges.

The San Jose, Calif.-based firm announced in mid-July it was cutting 6,500 jobs, downsizing its global workforce by 9% as part of efforts to slash operating costs.

Cisco shares were up 7.3% at $14.73 in after-hours trading in New York.

Copyright Agence France-Presse, 2011

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