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Cisco beats, affirms targets
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November 5, 2001: 7:13 p.m. ET
Company tops 1Q profit, sales estimates, sees 2Q sales flat to slightly higher.
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NEW YORK (CNNmoney) - Networking equipment maker Cisco Systems Inc. on Monday reported first-quarter earnings and revenue that fell sharply from a year ago but still beat Wall Street's expectations.
The company also said it expects to beat current revenue estimates for its second quarter.
Cisco said first-quarter earnings for fiscal 2002 came in at $332 million, or 4 cents per share, excluding certain items, compared with earnings of $1.4 billion, or 18 cents per share, in the same quarter a year ago.
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CEO John Chambers told Lou Dobbs on Moneyline that his company will be looking at 8-to-12 acquisitions for fiscal 2002.
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Shares of Cisco (CSCO: Research, Estimates), which gained 64 cents in regular session trade ahead of the report, added another 90 cents to $18.80 in after-hours trade.
The company said revenue for the quarter was $4.4 billion, down 32 percent from the same period last year. But sales did show a quarter-to-quarter increase, rising from $4.3 billion in the fourth quarter of fiscal 2001, the first sequential growth in nearly a year.
Analysts surveyed by First Call expected the company to earn 2 cents per share on average, with revenue of about $4.2 billion.
Looking to the second quarter, Cisco CEO John Chambers said in a conference call the company expects flat-to-low sequential revenue growth compared to the $4.4 billion it just reported. That would beat First Call's current second-quarter consensus revenue estimate of $4.25 billion.
Chambers also said the company is happy with its head count at the moment.
Appearing on Lou Dobbs Moneyline, Chambers said the results were a good first step, with solid financial performance across the board and that he was pleased with the sequential growth in revenue.
He said this quarter the company gained a "huge amount" of market share, but added he expects capital spending in the service provider market will continue to be tough.
At the beginning of October, Chambers said he was comfortable with Wall Street's consensus estimates for the first quarter, easing concern of investors who had seen a number of companies warn after the Sept. 11 attacks.
Cisco said it had gotten rid of $834 million of excess inventory in its fiscal first quarter, making progress in purging the $2.2 billion in inventory it is writing off because of weak demand, and predicted revenue will be flat-to-slightly higher in the next quarter.
Chambers also told Moneyline that with about $19 billion in cash and cash equivalents, the company will be looking at 8-to-12 acquisitions for fiscal 2002. 
-- from staff and wire reports
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