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Technology Stocks : Cisco Systems, Inc. (CSCO)

CSCO 76.93

+1.2%

12:59 PM EST

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To: Jacob S. Rosenberg who started this subject	2/6/2002 6:47:25 PM
From: KeepItSimple	Read Replies (5) of 77400

Here's why CSCO is collapsing after hours: Cisco was able to beat the numbers by selling tons of equipment that was shelved for disposal late last year when they took that multi-billion dollar charge. When Herb Greenburg brought this specific issue up at the time, CSCO responded that they were definitely not going to sell that hardware and that it was in fact "worthless". That's why they took the charge. CSCO said they wouldn't do it, but surprise surprise they are now unloading that inventory and THEY MAKE 100% PROFIT ON ALL THAT HARDWARE since it was charged off as WORTHLESS. That is boosting their margin like crazy. Without it, CSCO would have missed the numbers. ------------------------------------------ Net sales for the second quarter of fiscal 2002 were $4.8 billion, a sequential increase of 8% from the $4.4 billion in net sales for the first quarter of fiscal 2002. This compares to $6.7 billion in net sales for the same period last year, a decrease of 29%. Pro forma net income, which excludes the effects of acquisition charges, payroll tax on stock option exercises, net gains (losses) on investments, and an excess inventory benefit, was $664 million or $0.09 per share for the second quarter of fiscal 2002, compared with pro forma net income of $332 million or $0.04 per share for the first quarter of fiscal 2002, and $1.3 billion or $0.18 per share for the second quarter of fiscal 2001.

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