Cisco Systems this week topped Wall Street's expectations for its fourth fiscal quarter, reporting a 69 percent increase in net income and revenue growth of 61 percent for the three-month period ended July 29.
But the networking giant also said that Donald Listwin -- one of its two executive vice presidents and a potential successor to Cisco CEO John Chambers -- is leaving to become president and CEO of a new wireless and Internet communications software vendor being formed through a merger of start-ups Phone.com and Software.com.
Listwin was in charge of Cisco's corporate marketing department and its service provider and consumer business units. In a statement, Chambers said he was "very sorry to see [Listwin] leave." But Chambers noted that Listwin will continue to have ties to the company because Cisco is one of the investors in Software.com.
For its fourth quarter, Cisco reported total sales of US$5.72 billion, up from $US3.56 billion in the same period of its previous fiscal year. Net income was $US1.2 billion on a pro forma basis that doesn't take into account a series of one-time charges and gains reported by the company in both the most recent fourth quarter and the year-earlier one, when the profit figure amounted to $US710 million.
During the fourth quarter, Chambers said, Cisco executives "were very pleased with the balance of our business across all key geographies, products and lines of business." The company sees no indication that users of its networking equipment are slowing their Internet-driven overhauls of key business activities such as customer service and supply chain management, he added.
Meanwhile, the combination of Phone.com in Redwood City, Calif., and Software.com in Santa Barbara, California., is due to be completed by year's end.
The two companies had combined revenues of $US146 million in the 12 months ended June 30. They sell a mix of wireless and Internet infrastructure software for use by telecommunications carriers and Internet service providers.
A name for the merged company will be announced when the pooling-of-interests transaction is finalized. Under the agreement announced Wednesday, the shareholders of each company will own about 50 percent of the combined company's stock, although Phone.com is officially buying Software.com through a stock swap.