Analyst Conference Summary

conference date: August 11, 2010 @ 1:30 PM Pacific Time
for quarter ending: July 31, 2010 (4th quarter fiscal 2010)

Forward-looking statements

Overview: Recovery continues, but not up to expectations, despite being at upper end of guidance.

Basic data (GAAP) :

Revenues were $10.84 billion, up 4.5% sequentially from $10.37 billion and up 27% from $8.54 billion in the year-earlier quarter.

Net income was $1.93 billion, down 12% sequentially from $2.19 billion, but up 79% from $1.08 billion year-earlier

EPS (earnings per share) were $0.33, down 11% sequentially from $0.37, but up 74% from $0.19 year-earlier.

Guidance:

Conference Highlights:

John Chambers characterized the quarter as "very strong," leaving Cisco "in a tremendous position of strength." Profits will continue to come in whether or not the global economy slows. Cisco will continue investing in new economic opportunities "where the network is becoming the platform."

Non-GAAP results were $2.5 billion net income, up 36% y/y, with EPS $0.43.

Cash flow from operations was $3.2 billion. Cash and equivalents ended at $39.9 billion. $2.3 billion was spent on share repurchases at $24.02 per share.

CoreOptics, DVN, and MOTO Development Group acquisitions were completed.

The Cius mobile business tablet was launched. For the iPad/iPhone users the Quad enterprise collaboration platform was announced.

Product revenue was $8.8 billion, service revenue $2.03 billion.

Cost of sales was $4.04 billion, leaving gross profit of $6.79 billion. Operating expenses were $4.47 billion, including $1.39 billion for R&D, $2.35 billion for sales and marketing, $0.60 billion for general and administrative, and $131 million for amortization of purchased intangible assets. Leaving GAAP operating income of $2.33 billion. Interest income was near zero, income tax provision $483 million.

Q&A:

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