Cisco Returns to Growth
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Cisco Systems (NASDAQ: CSCO) gave the tech sector some good news late Wednesday when it reported its first quarterly sales growth in more than a year.
Cisco's sales rose 8 percent in its January quarter to $9.8 billion, $400 million better than the Thomson Reuters consensus forecast, and earnings of 40 cents a share were a nickel better than expected.
"Our outstanding Q2 results exceeded our expectations and we believe they provide a clear indication that we are entering the second phase of the economic recovery," CEO John Chambers said in a statement. "During the quarter we saw dramatic across the board acceleration and sequential improvement in our business in almost all areas."
On an upbeat conference call, Chambers also raised the company's current quarter sales outlook well above forecasts. Cisco shares rose 3 percent in after-hours trading after rising slightly ahead of the report.
The broader market traded mixed after two strong days of gains. ADP reported a better than expected loss of 22,000 private sector jobs last month. The U.S. government report on Friday is expected to show a small gain in overall employment for January.
Research in Motion (NASDAQ: RIMM) was a leader during the day, up 3.4 percent after a TD Newcrest analyst said the company's product development efforts appear promising. Apple (NASDAQ: AAPL) gained 1.7 percent, while Palm (NASDAQ: PALM) lost 3.5 percent.
AOL (NYSE: AOL) rose 2 percent after reporting a profit, while SGI (NASDAQ: SGI) and NetLogic (NASDAQ: NETL) soared on their results. Comcast (NASDAQ: CMCSA) slipped on its earnings report.
Micron (NYSE: MU) and Applied Materials (NASDAQ: AMAT) weighed on the chip sector. Micron is one of ten memory chipmakers facing EU price-fixing charges, while AMAT lost ground on reports that company employees in South Korea are facing charges of misusing confidential customer data, which could strain relations with Samsung and Hynix, according to Reuters.
Yahoo (NASDAQ: YHOO) rose 2 percent on news that it will sell HotJobs to Monster (NASDAQ: MNST).
The Nasdaq rose 1 to 2190, the S&P 500 lost 6 to 1097, and the Dow gave back 26 to 10,270. Volume fell to 4.29 billion shares on the NYSE, and 2.34 billion on the Nasdaq. Decliners led by a 23-14 margin on the NYSE, and 15-10 on the Nasdaq. Downside volume was 74 percent on the NYSE, and 49 percent on the Nasdaq. New highs-new lows were 127-31 on the NYSE, and 45-26 on the Nasdaq.