Mark,
I don't think I should be dumping those CSCO shares just yet...Cisco up at 99+ on afterhours...
SAN JOSE, California -- August 4, 1998 -- Cisco Systems, Inc., the worldwide leader in
networking for the Internet, today reported its fourth quarter and annual results for the
period which ended on July 25, 1998. Cisco closed its fiscal year with revenue of $8,459
million, an increase of 31% over the previous year.
Net sales for the fourth quarter were $2,390 million, compared with $1,765 million for the
same period last year, an increase of 35%. Pro forma net income, which excludes the
write-off of purchased in-process R&D discussed below, was $523 million or $0.48 per
share, compared with pro forma net income of $383 million or $0.37 per share for the
fourth quarter of 1997, increases of 36% and 30% respectively.
During the fourth quarter of fiscal 1998, Cisco completed the acquisition of CLASS Data
Systems for approximately $51 million and took a one-time charge of $48 million, or $0.03
per share on an after-tax basis, as a write-off of purchased in-process R&D.
Actual net income for the fourth quarter, including the above-mentioned write-off of
purchased in-process R&D, was $492 million or $0.45 per share, compared with $151
million or $0.14 per share in the same period last year.
Net sales for fiscal 1998 were $8,459 million, compared with $6,440 million for the same
period last year, an increase of 31%. Pro forma net income was $1,879 million or $1.75
per share, compared with pro forma net income of $1,414 million or $1.37 per share during
fiscal 1997, increases of 33% and 28% respectively.
Actual net income for fiscal 1998 was $1,350 million or $1.26 per share, versus actual net
income of $1,049 million or $1.01 per share for the same period last year. All earnings per
share amounts represent diluted earnings per share as defined within Statement of
Financial Accounting Standards No. 128 (FAS 128).
The company's board of directors authorized the splitting of Cisco's common stock on a
three-for-two basis for shareholders of record on August 14, 1998. Shares resulting from
the split are expected to be distributed by the transfer agent on September 15, 1998. This
action will be the seventh time that Cisco's common stock has been split since the
company's initial public offering in February 1990. Two-for-one stock splits occurred in
1991, 1992, 1993, 1994, and 1996; and a three-for-two split occurred in 1997.
"We are pleased to report our 34th consecutive quarter of revenue and earnings growth.
We were especially pleased, considering the challenges in the Asian market, with our 31%
increase in revenue over the last fiscal year. This year we gained more market share and
momentum, compared with our traditional competitors, than in any previous year in the
company's history," said John Chambers, president and CEO of Cisco Systems.
Cisco continues to advance its end-to-end Internet solutions for each of its key
markets-enterprise, small/medium business and service provider-through internal
development, strategic alliances, minority investments and acquisitions.
In the enterprise marketplace, Cisco continues to gain both market share leadership and
acceptance of its end-to-end Internet solutions. Highlights of the quarter include the
introduction of the company's next generation of multiservice routers, the Catalystr 8500
family. The Catalyst 8510 and Catalyst 8540 will help customers manage data, voice and
video applications over a single network. At the same time, the Catalyst 5500 high-end
switch surpassed the $1 billion revenue milestone within one year of its initial shipment.
In the small and medium business market, Cisco introduced an alliance with IBM to
deliver electronic commerce solutions to small businesses. The pact will help small and
growing businesses improve their internal networks and deliver faster access to the
Internet. With more than $1 billion in channel revenue, Cisco also became the market
leader in two-tier distribution of network systems.
In the service provider space, Cisco continues to see increasing market acceptance that
public voice networks will convert into data networks in the future. Sprint's decision to
align with Cisco to build out its future data, voice and video networks signaled a key shift
away from Old World, circuit-based networks toward a packet-based infrastructure.
Other milestones in the quarter include Cisco's delivery of New World technologies such
as broadband access to the home in the form of comprehensive xDSL solutions, cable,
voice-over-IP switching, carrier-class provisioning systems and new, open
standards-based network management solutions.
"Over the past 12 months, we have seen a dramatic shift in how the Internet is viewed.
Once seen as a tool used primarily by technologists, the Internet is now the catalyst
driving change in the new economy. The Internet is being recognized among business,
government and individuals worldwide as the strategic element for competitive advantage.
Cisco is well positioned to play a key role in the new Internet Economy. I want to thank
our employees, shareholders and partners for their support throughout Q4 and fiscal '98.
And I'd especially like to thank our customers for their continued commitment and
confidence," concluded Chambers. |
