Chambers bullish about Cisco's prospects

Cisco gave Wall Street better results than many had expected on Tuesday when it reported that revenue in the fourth quarter increased 12.5 percent year-on-year, higher than the company's predicted figure of 10 to 12 percent.

"I would characterise the quarter as a very strong and record quarter from a revenue, net income, and ... earnings-per-share perspective," said chief executive John Chambers in a statement.

But while Chambers was able to report that four of Cisco's five geographic areas "experienced stronger annual product order growth when compared to a strong Q4" of last year, Europe was the exception.

The company is trying to address the issue. "In Europe we did see some improvement versus earlier in the fiscal year," said Chambers. "Order growth slightly improved to the high single digits."

Meanwhile, in the US, "Orders grew in the upper teens year-over-year while total worldwide orders grew in the mid-teens," he said.

Network equipment for business and telecommunications networks accounted for most of Cisco's revenue, but the company has been expanding into the consumer market with the acquisition of cable set-top box maker Scientific-Atlanta in February.

Overall, Cisco's sales in the fourth quarter rose to $7.98bn from $6.6bn in the same quarter a year earlier. However, growth in net income was slower, rising to $1.544bn or 25 cents per share, compared with $1.54bn, or 24 cents per share in the same quarter a year ago.

Figures for the latest quarter included stock-based compensation expense and employee stock purchases.