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To: Lizzie Tudor who wrote (14328)	10/15/2002 2:16:32 PM
From: Bill Harmond	Read Replies (1) \| Respond to of 57684

Right! Viacom in particular. Sold Tyco. The bank covenant thing is making me nervous.

To: Lizzie Tudor who wrote (14328)	10/15/2002 2:54:23 PM
From: stockman_scott	Respond to of 57684

Cisco defies Wall Street's revenue fears By Scott Morrison in San Francisco FT.com Tuesday October 15, 1:40 pm ET Cisco Systems looks set to stick by its first-quarter revenue forecast despite concerns by a group of prominent industry analysts that the networking equipment maker cannot meet its sales target. "They are not going to hit their guidance. The question is how much they will miss it by," said Nikos Theodosopoulos, an analyst at UBS Warburg. However, sources familiar with the company said that with two weeks until the end of the first quarter, Cisco would by now have a fairly good idea as to whether or not it was on track to meet its revenue targets. The fact that Cisco has not lowered its forecast by now suggested the company was comfortable with its outlook, the sources said. Cisco, the largest maker of equipment that carries data traffic across the internet and corporate networks, said it would not comment on speculation about first-quarter revenue. The technology bellwether's share price has been extremely volatile in the past few weeks amid growing concern that the deteriorating macroeconomic environment would impact on Cisco's sales in the current and upcoming quarters. Several analysts have noted that channel checks indicated there had been a slowdown in business starting mid-September. John Chambers, Cisco's chief executive, has sounded a very conservative note in recent appearances, repeatedly noting that sales visibility has become extremely "tight" this quarter. The group's official forecast calls for first-quarter revenues to be flat to slightly higher than the $4.83bn achieved in the fourth quarter. The current consensus among Wall Street analysts is that Cisco will report revenues of about $4.87bn, according to Thomson Financial/First Call. But a group of prominent analysts, such as Samuel Wilson at Merrill Lynch, have recently lowered their first-quarter estimates for Cisco. Mr Wilson last week revised his revenue forecast from a 2 per cent increase to a 1 per cent drop at $4.78bn. Goldman Sachs changed its sales estimate from flat to a drop of 3 per cent. Lehman Brothers was much more pessimistic, predicting Cisco's first-quarter revenues might fall more than 5 per cent to $4.56bn. The estimate for Cisco's first-quarter earnings has been tweaked down to 13 cents per share from 14 cents, with analysts noting the company has a strong ability to control costs. The timing of the September slowdown was far from ideal for Cisco, which typically sees first-quarter sales start slowing in August, build throughout September and grow stronger by the end of October. Cisco's focus on the corporate networking market has enabled the group to withstand the information technology spending slump much better than rivals Lucent Technologies and Nortel Networks. Those companies are highly dependent on large telecoms carriers, which have sharply curtailed capital expenditures following the boom years of the late 1990s. Shares in Cisco, which last week plunged to levels not seen in almost five years, were trading up 71 cents at $10.70 in Tuesday midday trading in New York.