Cisco Systems Inc. announced Wednesday afternoon that its first-quarter sales increased 9 percent over the same quarter a year ago.
The networking leader, long considered a bellweather of the IT industry, said after the close of financial markets that sales for the quarter ending Oct. 26 hit US$4.8 billion, up from $4.4 billion in the same quarter of 2001.
Net income for the quarter was 8 cents per share, or $618 million, compared with a loss of 4 cents per share and $268 million for the year-earlier quarter.
"Despite the challenging market, we continued to execute ahead of our competitors, resulting in another solid quarter for Cisco," John Chambers, CEO of Cisco, said during a conference call with analysts Wednesday. "We are well positioned for an upturn, regardless of when it occurs."
Chambers described investments in networking by Cisco customers as a "long-term strategic investment for driving productivity."
He went on to say that Cisco has seen a 9 percent increase in sales during the past year, while its 10 largest North American competitors have together seen a 48 percent decline.
Bill Lesieur, an analyst at Technology Business Research Inc. in Hampton, N.H., said just before the earnings call that "Cisco [internally] has completely regained any confidence that was lost in 2001." He noted that Cisco's future for providing telecom equipment to service providers "is still very uncertain."
Lesieur described the telecom industry as being in crisis, with lowered service provider investments "creating havoc" for Cisco competitors Lucent Technologies Inc. and Nortel Networks Corp.
He suggested that Cisco should acquire all or part of Lucent Technologies Inc. or Nortel Networks Corp., adding that if Cisco doesn't, "it may never become a major telecom equipment player."