Cisco Systems edged past Wall Street's revised estimates when it reported third-quarter earnings last week, but noted that its net income plunged 77 per cent and sales fell 4 per cent from the same quarter a year ago in the face of a slowing market for networking hardware.
For the third-quarter 2001, Cisco reported net income of $US230 million, excluding a host of charges, compared to net income of $1 billion for the third quarter of fiscal 2000.
Net sales for the quarter fell to $4.73 billion, compared to $4.93 billion for Q3 2000.
Thirty analysts polled by Thomson Financial/First Call expected Cisco to report earnings of 2 cents on sales of $4.7 billion. Analysts lowered estimates in April from 8 cents per share after Cisco warned of its third-quarter shortfall, and said the economy would continue to lower its quarter-on-quarter results through the end of the fiscal year.
Without subtracting its one-time costs, which include acquisition charges, payroll tax on stock-option exercises, restructuring costs and other special charges, an excess inventory charge, and net gains realised on minority investments, actual net loss for the third quarter was $2.69 billion or 37 cents per share, compared with actual net income of $641 million or 8 cents per share for the same period last year.