3Com beats estimates at 36 cents per share

3Com has announced second-quarter earnings of $US0.36 per share, handily beating market estimates for the networking company and leaping more than 30 per cent over earnings a year ago.

For the quarter ended November 27, 3Com earned $US132.9 million, or $US133.4 million excluding merger and real estate related charges, compared to $US4 million, or one cent per share, for the same quarter a year ago.

Analysts polled by First Call predicted 3Com would announce earnings per share of 31 cents for the second quarter.

Sales of $US1.54 billion for the quarter were 29 per cent higher than the $US1.197 billion in sales reported for the second quarter last year, the company said in a statement. Sales of systems products totalled $US744.7 million, up 25 per cent year-over-year, while client access product sales were $US795.8 million, up 33 per cent from the same period last year.

3Com attributed the strong results to "sustained favourable market conditions across the networking industry and continuous improvements in our operational management," as well as to new product momentum and seasonal strength, Eric Benhamou, chairman and chief executive officer, said in the statement.

During the quarter, 3Com announced: the acquisition of EuPhonics, a developer of digital signal processing-based audio software that drives integrated circuits, sound cards and consumer electronics; a new carrier-class IP telephony system; and a strategy for building so-called High Availability Networks for running voice-over-IP and other critical applications.

3Com also formed strategic original equipment manufacturer relationships with IBM, Hewlett-Packard and Toshiba America, and expanded its relationship with Dell Computer. Even more notably, though, 3Com introduced the Palm VII handheld computer.

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