See bold in article below. CSCO claimed today to
be taking market share away from ASND in both the
telco and dial access segments. Query how/whether the Street
will respond to this assertion:
2/4/98 Fin. Times 15
1998 WL 3530117
Financial Times
Copyright Financial Times Limited 1998
Wednesday, February 4, 1998
Front page - Companies & markets
Cisco Systems records net income of $457m
By Nicholas Denton in San Francisco
Cisco Systems, extending its lead over competitors in the networking
equipment sector, turned in another set of strong results yesterday.
The company, producing its 32nd quarter of unbroken revenue and
earnings growth, announced net income of $457m for the quarter just
ended, up 30 per cent on a year earlier.
The networking industry as a whole has experienced a slowdown in its
breakneck growth rate, contributing to profit shortfalls at equipment-
makers such as 3Com and Ascend Communications.
But Cisco, with earnings equivalent to 43 cents a share, appeared
immune yesterday, coming in one cent above the Wall Street consensus
estimate measured by the First Call research group. The results were
released after the close of trading in New York, where Cisco shares
closed $ 15/16 lower at $63.
Cisco, which is the leading maker of the routers that direct internet
traffic and controls about 45 per cent of the entire networking market,
said it had gained market share as clients streamlined their equipment
purchases.
"There is increasing acceptance of an 'end-to-end' partner," said John
Chambers, Cisco president and chief executive. "It is our view that the
industry will continue to consolidate. We fully expect more mergers,
acquisitions and partnerships will occur."
Cisco said it had expanded sales to telecommunications carriers, at
the expense of competitors such as Ascend and Newbridge Networks.
Cisco touted its new relationship with US West, the regional Bell
carrier, which in a landmark transaction chose Cisco to supply a new
network carrying both voice conversations and data such as electronic
mail.
Meanwhile, shares in Canada's Newbridge Networks -- a former supplier
to US West and one of the smaller networking equipment-makers -- plunged
on a profits warning, which cited competition from Cisco.
Cisco said its revenues from "dial" products -- devices that enable
mobile employees to hook their computers into corporate networks -- had
for the first time exceeded those of Ascend.
The company saw growth in both the US and Europe. However, Asian
revenues continued to decline -- from 16 per cent to 10 per cent -- as a
result of the region's economic crisis. Newbridge slides, Page 18
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