Technology, Discovery & Innovation NewsFactor Sites:       NewsFactor.com     Enterprise Security Today     CRM Daily     Business Report     Sci-Tech Today  
   
Home Computing Digital Life Discovery Space More Topics...
GET RECOGNIZED
Let an ISACA® certification elevate your career.
Register today and save
You are here: Home / Computing / Cisco Focus on Networks Pays Off
Cisco Focus on Networks Pays Off in Q2 Earnings
Cisco Focus on Networks Pays Off in Q2 Earnings
By Jennifer LeClaire / Sci-Tech Today Like this on Facebook Tweet this Link thison Linkedin Link this on Google Plus
PUBLISHED:
FEBRUARY
09
2012


Cisco beat the street with its second-quarter earnings. The company's net income rose 44 percent in the quarter ended Jan. 28 as Cisco CEO John Chambers continued leading the company out of its 2011 funk.

After a round of layoffs and a renewed focus on its core business, Cisco tallied $2.2 billion in net income during the quarter. That compares with $1.5 billion in the year-ago period. At the end of the quarter, Cisco posted 47 cents per share earnings. Analysts predicted 43 cents per share.

"We are executing well on our three-year plan to drive earnings faster than revenue. Our operational focus continues to yield positive results -- we hit our billion dollar expense reduction a quarter early -- and our ongoing innovation enables our customers to solve their critical business needs," Chambers said. "You will continue to see a focused and aggressive Cisco that is helping our customers use intelligent networks to transform their businesses."

Cisco's Switch Business

Zeus Kerravala, principal analyst at ZK Research, pointed out investor concern for Cisco's switching business in past quarters. It's a valid concern, considering switches are the largest part of Cisco's revenue.

"Much of the industry has been calling for a decline in margins. For a while the margins did decline. Part of that was due to the competitive landscape and some of the products from low-cost providers. I think Cisco was caught off-guard by that because of their lack of focus on networking," Kerravala said.

"Cisco was focused on flip cameras and consumer devices. Chambers made the promise that networking was going to be a focus for them last year and it has been. Now margins for switches are returning to what they were three years ago. For investors, that's a great sign."

Kerravala noted rumblings in the blogosphere about quality. As he sees it, there's a lack of recognition about the difficulty of enterprise networking. Unlike PCs, where anyone can connect machines with some low-end cables, enterprise networking is a challenge.

"Organizations like Cisco, Juniper and Brocade are pushing out the innovation. You just can't throw a bunch of hardware together and have a switch that sells at cut rate prices," Kerravala said.

"Do we really want our networks built to the same quality as PCs today? That would be terrible for the industry. People are willing to pay the extra value for well-built infrastructure with innovative features. That's what Cisco has always been about. Networking is really the right focus for them."

Cisco's Cloud Moves

During the quarter, Cisco completed its acquisition of BNI Video, which supplies service providers with two major video products that offer video back-office and content delivery network analytic capabilities. Cisco also crossed the 10,000-customer mark for its Unified Computing System, which integrates computing, networking, management and virtualization.

Cisco in the second quarter also introduced Cisco CloudVerse, a framework that combines the foundational elements required to enable organizations to build, manage and connect public, private and hybrid clouds, and Videoscape, which helps enable "video in the cloud" services.

Finally, Cisco beefed up its Connected Grid portfolio and announced a series of advances that can give mid-size businesses access to "enterprise-grade" IP phone systems with integrated collaboration capabilities.

Tell Us What You Think
Comment:

Name:

Like Us on FacebookFollow Us on Twitter
TOP STORIES NOW
MAY BE OF INTEREST
Salesforce.com is the market and technology leader in Software-as-a-Service. Its award-winning CRM solution helps 82,400 customers worldwide manage and share business information over the Internet. Experience CRM success. Click here for a FREE 30-day trial.
MORE IN COMPUTING
Product Information and Resources for Technology You Can Use To Boost Your Business

Network Security Spotlight
Dairy Queen Latest Retailer To Report Hack
Known for its hot fries and soft-serve ice cream, Dairy Queen just made cyber history as the latest victim of a hack attack. The fast food chain said that customer data at some stores may be at risk.
 
Lessons from the JPMorgan Chase Cyberattack
JPMorgan Chase is investigating a likely cyberattack. The banking giant is cooperating with law enforcement, including the FBI, to understand what data hackers may have obtained.
 
Who Is the Hacker Group Lizard Squad?
Are they dangerous or just obnoxious? That’s what many are wondering about the hacker group Lizard Squad, which tweeted out a bomb threat that grounded a flight with a Sony exec aboard.
 

Enterprise Hardware Spotlight
Intel Intros Lightning-Fast PC Processors
Call it extreme. Intel just took the covers off its first-ever eight-core desktop processor, which is aimed at hardcore power users who expect more than the status quo from their computers.
 
HP Previews ProLiant Gen9 Data Center Servers
Because traditional data center and server architectures are “constraints” on businesses, HP is releasing new servers aimed at faster, simpler and more cost-effective delivery of computing services.
 
Apple Set To Release Largest iPad Ever
Tech giant Apple seems to have adopted the mantra “go big or go home.” The company is planning to introduce its largest iPad ever: a 12.9-inch behemoth that will dwarf its largest existing models.
 

Mobile Technology Spotlight
iWatch Watch: What Will Apple Ask Us To Wear?
There are still more questions than answers when it comes to details about the smart watch Apple seems poised to debut on Sept. 9. In fact, nobody seems completely sure that it will be a smart watch at all.
 
Samsung Maps Its Way with Nokia's 'Here' App for Galaxy Phones
Korean electronics giant Samsung has opted to license Here, Nokia’s mapping app -- formerly known as Nokia Maps -- for its Tizen-powered smart devices and Samsung Gear S wearable.
 
Google Successfully Tests Its Own Delivery Drone
While top technology companies are engaged in an "arms race" to develop drones that can quickly deliver goods to anyone anywhere, Google has revealed it successfully tested its own version.
 

Navigation
Sci-Tech Today
Home/Top News | Computing | Digital Life | Discovery | Space | Innovation | Health | Science News
Environment
NewsFactor Network Enterprise I.T. Sites
NewsFactor Technology News | Enterprise Security Today | CRM Daily

NewsFactor Business and Innovation Sites
Sci-Tech Today | NewsFactor Business Report

NewsFactor Services
FreeNewsFeed | Free Newsletters

About NewsFactor Network | How To Contact Us | Article Reprints | Careers @ NewsFactor | Services for PR Pros | Top Tech Wire | How To Advertise

Privacy Policy | Terms of Service
© Copyright 2000-2014 NewsFactor Network. All rights reserved. Article rating technology by Blogowogo. Member of Accuserve Ad Network.