Cisco Earnings Preview: Good Times Ahead for Networking?
The company's earnings today could indicate if a recovery is in motion.
During Cisco's first-quarter investor call, CEO John Chambers provided revenue guidance for its second fiscal quarter of an increase in the range of 1 percent to 4 percent, compared to a year earlier.
Wall Street analysts predict earnings of $0.35 per share, according to Thomson Financial -- an upswing from the $0.32 it posted a year ago, when revenue topped $9.1 billion.
If Cisco makes good on those predictions, it will be the second major sign from networking vendors that a turnaround may be near. Juniper reported its fourth-quarter 2009 earnings last week, with revenue of revenue of $941.5 million, up by 2 percent on a year-over-year basis. Executives noted that they see the market for networking improving, led in part by the service provider segment.
From a business perspective, the second quarter was another busy period for Cisco. On the collaboration side of its business, Cisco rolled out a series of new products for video, e-mail, voice and instant messaging. Among them is Cisco WebEx Mail, which is a Linux-powered, hosted e-mail solution that competes against Google's Gmail.
Cisco also updated its Unified Presence 8.0 product to include Jabber XMPP-based presence and messaging.
In January, Cisco unveiled a new home telepresence effort that will bring high-quality video conferencing to consumers later this year.
Cisco also closed a pair of acquisitions during the quarter. Among them was the close of a deal for Software-as-a-Service security vendor ScanSafe for $183 million. Cisco's wireless division also got a boost with the close of the $2.9 acquisition of wireless vendor Starent.
One key deal that Cisco did not close during the quarter was its proposed $3.4 billion bid for telepresence vendor Tandberg, which is still pending final approvals.