Cisco profits up 27% amid fresh signs of recovery

6 August 2003 Cisco Systems has tightened its grip on the networking equipment market amid signs that the economic recovery may be gaining momentum.

Cisco said yesterday that fourth-quarter net income rose 27% to $982 million, thanks to market share gains in the high-end router and switch businesses.

New orders increased by almost a tenth and exceeded shipments for only the second time in the last seven quarters. Orders for its fastest — and most expensive — routers climbed by about one quarter.

“For the first time in a long time, we are seeing a number of positive signs of economic recovery,” said Cisco CEO John Chambers. He said he had met a number of CEOs recently who were more bullish about their own company’s prospects.

But there is still a long way to go, Chambers cautioned. “While things are starting to look better, it is still fragile,” he said. Underlining the point, quarterly revenues nevertheless slipped 3% to $4.7 billion, as the legacy of two years of weak corporate spending continued to bite.

However, sales in Cisco’s first quarter are forecast to rise by between 2% and 4%, largely due to revenue from Cisco’s recent Linksys acquisition. Linksys specialised in home networking products.

Avatar photo

Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

Related Topics