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Wednesday, August 6, 2008

Cisco Systems (CSCO) 4Q:2008 results

Cisco beat by a little on the top and the bottom line. They were constructive on enterprise spending and some analysts have suggested their tone is better. Service provider orders grew at 5%, down from last quarter's 6% and the high teens last year. They said book to bill was comfortably above 1 but drew on deferred revenue which shrunk by 165 mil. They also lowered growth forecasts by a percentage point on a year to year basis for the next two quarters and indicated economic uncertainty will be their bedfellow for the next several quarters.

The stock is rallying on this. I'm not going to be buying it. Good company. Now at that $40 billion dollar threshold -- its a lot harder to grow a 40 billion dollar company. I don't think their claims of 12-15% long-term growth are realistic.

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