Cisco Quarter Pleases Investors, AnalystsBy Jessica Davis | Print
Cisco reported higher year-over-year net sales but saw net income decline as restructuring charges eroded profits.
Cisco (NASDAQ:CSCO) surprised the industry with higher than expected revenues for its fourth quarter. Net sales hit $11.2 billion for Q4, representing a 3.3 percent increase, and $43.2 for the full year.
But net income fell to $1.2 billion compared to $1.9 billion in the same period a year ago as $772 million in restructuring and $923 million in other charges hit the bottom line. The restructuring included job cuts of 6,500 as part of Cisco’s effort to return to its core businesses after Chairman and CEO John Chambers acknowledged that Cisco had lost its focus. Now the company is returning to the right track, he said.
"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 Chambers, in a statement. "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."
For the full fiscal year Cisco reported net income of $6.49 billion compared to $7.77 billion for the previous year.Shares of Cisco rose by close to 20 percent in Thursday morning trading.