A leaked memo has confirmed that network equipment maker Cisco Systems is set to beat Wall Street expectations. Officials maintained that the company is on track with a "focus on profitability".
President and chief executive John Chambers said in a conference call with analysts: "We are as optimistic as ever, but we still have limited visibility over the short term market."
He explained that, while most economists believe the slowdown is starting to turn, others see it as a plateau. "Our financial results this quarter establish a second, slightly higher plateau," he said.
Chambers added that orders were not coming in as fast as Cisco was shipping products, but that the company is "on track with our focus on profitability. No one is really sure, but we are cautiously optimistic."
Looking ahead, Cisco only gave guidance on its current third quarter, which Chambers said is traditionally a challenging one for the firm.
He added that he sees third-quarter revenue flat to a percentage rise in the low single digits compared to the second quarter.
A Cisco executive unintentionally released a memo late the day before which indicated that the company's results would surpass analyst expectations. It then issued a news release early on Wednesday (6 February), but did not discuss specific details.
Cisco reported pro forma earnings of $664m, or nine cents per share, on revenue of $4.8bn for its fiscal 2002 second quarter, compared with earnings of $1.3bn, or 18 cents per share, in the year ago period.
It was expected to earn five cents per share on revenue of $4.55bn pro forma, according to consensus estimates from First Call.
Cisco shares, which have declined 48 per cent in the last year, rose 11 cents to $18.61 in regular trading and dropped as low as $16.95 in after hours trading.
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